taneja aerospace & aviation ltd (onf)(110915) · the cost audit report for the year 2013-14 was...

Annual Report 2014-15

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COMPANY INFORMATION

BOARD OF DIRECTORS

Salil Taneja Chairman

B. R. Taneja Director (upto August 14, 2015)

Preeti Taneja Director (w.e.f. August 14, 2015)

C. S. Kameswaran Director

R. Surie Director

R. Poornalingam Director (w.e.f. November 13, 2014)

N. Chandra Director (w.e.f. November 13, 2014)

Raj K. Sureka Director (w.e.f. August 14, 2015)

K. Rustumji Director (upto August 13, 2015)

J. P. Sureka Director (upto December 1, 2014)

S. M. Kapoor Managing Director (w.e.f. December 1, 2014

upto March 31, 2015)

COMPANY SECRETARY

Priya Nair (upto May 28, 2015)

Chetan Nathani (w.e.f. August 14, 2015)

AUDITORS

M/s. Haresh Upendra & Co.

Chartered Accountants

BANKERS

Allahabad Bank

Canara Bank

Vijaya Bank

REGISTERED OFFICE & WORKS

Belagondapalli Village, Thally Road, Denkanikottai Taluk, Krishnagiri District,

Belagondapalli – 635114, Tamil Nadu

Phone : 04347 - 233508, Fax : 04347 - 233414

E-mail : [email protected] Website : www.taal.co.in

CIN : L62200TZ1988PLC014460

CORPORATE OFFICE

GGR Towers, 2nd Floor, Sy # 18/2b, Sarjapur Road

Bangalore – 560 103, Karnataka

REGISTRAR & SHARE TRANSFER AGENT

Sharepro Services (India) Pvt. Ltd.

Taneja Aerospace and Aviation Limited

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To the Members of Taneja Aerospace and Aviation Limited

Your Directors present herewith the Twenty-sixth Annual

Report and the Audited Accounts for the year ended

March 31, 2015.

FINANCIAL HIGHLIGHTS

(Rs. in Lakhs)

Particulars 2014-15 2013-14

Gross Income 3527.00 5472.05

Expenditure 3786.01 4705.98

Finance Charges 694.44 543.27

Depreciation 345.93 352.43

Profit/(Loss) Before Tax (1299.39) (129.63)

Provision for Taxation (564.38) -

(including Deferred Tax)

Tax for earlier years 8.31 -

Prior Period Items 8.95 2.46

Extra-ordinary items 0.75 -

Profit/ (Loss) after Tax and (753.02) (132.10)

Prior Period Items

DIVIDEND

Your Directors are unable to recommend a dividend for the

year ended on March 31, 2015, in view of the loss.

OPERATIONS

The gross income was lower since Engineering design

services division was hived off w.e.f. August 1, 2013.

During the year the Company commenced the business of

trading activity of electrical goods.

SCHEME OF ARRANGEMENT

The Board of Directors of your Company at its meeting held

on October 9, 2014, approved the Scheme of Arrangement

between Taneja Aerospace and Aviation Ltd. & TAAL

Enterprises Ltd. a wholly owned subsidiary of the Company

& their respective shareholders (“Scheme”) for demerger of

Charter business & investment in First Airways Inc. & TAAL

Tech India Pvt. Ltd. The Scheme was subsequently approved

by Hon’ble High Court of Judicature at Madras vide its Order

dated June 22, 2015. The Scheme will become effective upon

filing the said Order with the Registrar of Companies.

However, the details of Discontinuing operations as required

by AS-24 form part of the Notes to Accounts.

INDEPENDENT DIRECTORS AND KEY MANAGERIAL

PERSONNEL

Mr. R Poornalingam and Mr. N Chandra were appointed as

Independent Directors of the Company w.e.f November 13,

2014.

Directors’ Report

Mr. Ajay Gupta was appointed as Chief Financial Officer of

the Company w.e.f November 13, 2014.

Ms. Priya Nair resigned as Company Secretary and

Compliance Officer of the Company w.e.f. May 29, 2015 due

to personal reasons.

Mr. Chetan Nathani has been appointed as Company

Secretary and Compliance Officer of the Company w.e.f.

August 14, 2015.

The Independent Directors of the Company had given a

declaration pursuant to Section 149(7) of the Act.

The Company has devised a Policy for performance

evaluation of Independent Directors, Board, Committees and

other individual Directors which include criteria for

performance evaluation of the Non-Executive Directors and

Executive Directors like : Knowledge and Skills, Familiarity

with the Company and its business, Monitoring Company’s

Corporate Governance Practices, Development of strategies

and risk management, Participation and attendance in

meetings, Professional conduct, Sharing of information etc.

The details of familiarization programme of Independent

Directors with the Company, their roles, rights,

responsibilities in the Company, nature of the industry in

which the Company operates, business model of the

Company and related matters are put up on its website

www.taal.co.in

OTHER DIRECTORS

In accordance with the provisions of the Companies Act,

2013 (‘Act’) and the Articles of Association of the Company,

Mr. C.S. Kameswaran retires by rotation and being eligible,

offers himself, for re-appointment.

Mr. J. P Sureka resigned as Director of the Company w.e.f.

December 2, 2014 due to personal reasons. The Board placed

on records its appreciation and gratitude for his guidance

and contribution to the Company.

Mr. S M Kapoor, Chief Executive Officer (CEO) of Aircraft

Manufacturing Complex, Hosur of the Company was

appointed as Whole-time Director designated as the

Managing Director (MD) of the Company w.e.f December 1,

2014. Unfortunately, owing to ill health, Mr. S.M. Kapoor

had to resign as MD of the Company w.e.f. April 1, 2015. The

Board placed on records its appreciation and gratitude for

his guidance and contribution to the Company.

The Members of the Company had approved the

appointment of Mr. Salil Taneja as Whole-time Director of

the Company on March 31, 2015.

Mr. C.S. Kameswaran ceased to be MD as on November 30,

2014 and has continued to be a Non-Executive Director

thereafter.

Mr. K. Rustumji resigned as Director of the Company w.e.f

August 14, 2015 due to personal reasons. The Board placed


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on records its appreciation and gratitude for his guidance

and contribution to the Company.

Mr. B. R. Taneja resigned as Director of the Company

w.e.f. August 15, 2015. The Board placed on records its

appreciation and gratitude for his guidance and

contribution to the Company.

Mrs. Preeti Taneja & Mr. Raj K. Sureka have been

appointed as an Additional Directors of the Company

w.e.f. August 14, 2015 to hold office upto the ensuing

Annual General Meeting.

AUDITORS

M/s. Haresh Upendra & Co., Chartered Accountants retire

as Statutory Auditors of the Company at the conclusion of

ensuing Annual General Meeting but do not offer themselves

for re-appointment.

M/s. MZSK & Associates, Chartered Accountants have

confirmed that their appointment as Statutory Auditors of

the Company for the financial year 2015-16 will be in

compliance with Section 141 of the Companies Act, 2013

and offer themselves for appointment as Statutory Auditors

of the Company for the financial year 2015-16 pursuant to

Section 139 of the Act.

The Directors sincerely thank M/s. Haresh Upendra & Co.,

Chartered Accountants for the professional services

rendered by them to the Company.

As regards Auditors’ remarks, amounts due from LightO

Technologies Pvt. Ltd. are being regularly received

subsequent to the Balance Sheet date and the entire

outstanding amount is fully recoverable. Further, amounts

paid to Associate Company represent expenses incurred in

the ordinary course of business. Other remarks of Auditors

have been suitably dealt with in the Directors Report and

Notes to Accounts.

COST AUDIT

The Cost Audit Report for the year 2013-14 was due on

September 30, 2014 and was filed with the Ministry of

Corporate Affairs on September 26, 2014.

Cost Audit is not applicable to the Company effective from

financial year 2014-15.

SUBSIDIARY AND ASSOCIATE COMPANIES

During the year under review, Katra Auto Engineering PrivateLimited became wholly-owned subsidiary of the Companyand TAAL Enterprises Limited was incorporated as wholly-owned subsidiary of the Company.

TAAL Aerosystems Private Limited ceased to be anAssociate Company effective April 07, 2015.

As on date of this report, the Company has five direct andindirect subsidiaries. A Report in Form AOC-1 onperformance & financial position of each of the subsidiariesas per the Companies Act, 2013 is provided in the financial

statements forming part of this Annual Report.

The Company has framed a Policy for determining MaterialSubsidiaries which is available on its website www.taal.co.in

FIXED DEPOSITS

The Company has not accepted any deposits from the public.

MANAGEMENT DISCUSSION & ANALYSIS AND

CORPORATE GOVERNANCE REPORT

Pursuant to Clause 49 of the Listing Agreement with theStock Exchange, a separate section on ManagementDiscussion & Analysis and Corporate Governance togetherwith Certificates is forming part of this Report.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the provisions of Section 134(3)(c) read withSection 134(5) of the Companies Act, 2013, your Directorsmake the following statement:

i) that in the preparation of the annual accounts, the

applicable accounting standards have been followed

along with proper explanation relating to material

departures;

ii) that the Directors have selected such accounting policies

and applied them consistently and made judgments and

estimates, that are reasonable and prudent so as to give

a true and fair view of the state of affairs of the Company

at the end of the financial year March 31, 2015 and of

the Loss of the Company for that period;

iii) that the Directors have taken proper and sufficient care

for the maintenance of adequate accounting records in

accordance with the provisions of the Companies Act,

2013 for safeguarding the assets of the Company and

for preventing and detecting fraud and other

irregularities;

iv) that the Directors have prepared the annual accounts

on a going concern basis;

v) That considering the size and nature of business the

Directors had laid down internal financial controls to be

followed by the Company and that such internal financial

controls are adequate and were operating effectively;

vi) That the Directors had devised proper systems to ensure

compliance with the provisions of all applicable laws

and that such systems were adequate and operating

effectively.

EXTRACT OF ANNUAL RETURN

The extract of Annual Return in Form MGT-9 is forming partof this Report as Annexure A.

CONSERVATION OF ENERGY, TECHNOLOGY

ABSORPTION AND FOREIGN EXCHANGE EARNINGS

& OUTGO

The particulars as required under Section 134(3)(m) of theCompanies Act, 2013 is forming part of this Report as

Annexure B.

Directors’ Report (Contd.)


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NOMINATION AND REMUNERATION POLICY

The Nomination and Remuneration Policy of the Company

on director’s appointment and remuneration including

criteria for determining qualifications, positive attributes,

independence of a director and other matters is available on

its website www.taal.co.in

The criteria for performance evaluation as laid down by

Nomination and Remuneration Committee has been defined

in the Nomination and Remuneration Policy.

Details pertaining to remuneration of Directors and

employees required under Section 197(12) of the Companies

Act, 2013 read with Rules framed thereunder are forming

part of this Report as Annexure C.

SECRETARIAL AUDIT REPORT

Pursuant to Section 204 of the Companies Act, 2013 the

Board has appointed M/s. MRM Associates, a firm of

Company Secretaries in Practice as Secretarial Auditors to

undertake the Secretarial Audit of the Company for the

financial year ended March 31, 2015. The Report of the

Secretarial Auditors in Form MR-3 is forming part of this

Report as Annexure D. The Company is in the process of

appointing an Independent Director and a Woman Director

to address the observations mentioned in the Secretarial

Audit Report and upon demerger, the Company will not have

any material unlisted Indian Subsidiary.

PARTICULARS OF LOANS, GUARANTEES AND

INVESTMENTS

Particulars of Loans, Guarantees and Investments covered

under Section 186 of the Companies Act, 2013 is mentioned

in notes to the Financial Statements forming part of this

Report.

RISK MANAGEMENT

The Company is developing a risk management frame work

including the policy covering material risks. The Company

has already identified the key risk as delays in award of

Government Orders for its core manufacturing.

INTERNAL FINANCIAL CONTROLS

Internal controls of the Company are being strengthened

with the help of the CFO appointed during the year, taking

into account the changing business requirements and the

comments of the Auditor.

AUDIT COMMITTEE AND VIGIL MECHANISM

The Composition of Audit Committee is mentioned in Report

on Corporate Governance which is forming part of this

Report.

The Whistle Blower Policy/ Vigil Mechanism of the Company

was established by the Board and is available on its website

www.taal.co.in

CONTRACTS AND ARRANGEMENTS WITH RELATED

PARTIES

During the year, the Company had not entered into any

contract/ arrangement/ transaction with related parties which

were either not at an arm’s length or not in the ordinary

course of business and further could be considered material

in accordance with the policy of the Company on materiality

of related party transactions.

Hence, there is no information to be provided in Form AOC-

2 while the particulars of all Related Party Transactions in

terms of AS-18 are forming part of the financial statements.

The Policy on materiality of related party transactions and

dealing with related party transactions as approved by the

Board may be accessed on the Company’s website at

www.taal.co.in

GENERAL

1. No significant or material orders were passed by the

Regulators or Courts or Tribunals which impact the

going concern status and Company’s operations in

future.

2. Your Directors further state that during the year under

review, there were no cases filed pursuant to the Sexual

Harassment of Women at Workplace (Prevention,

Prohibition and Redressal) Act, 2013.

ACKNOWLEDGEMENTS

The Directors express their appreciation for the continued

support and co-operation received by the Company from its

Customers, Bankers, Shareholders, Suppliers, Business

Partners, Defence Research and Developmental

Organizations, Aviation Authorities and other Indian

Services and the Central and State Governments. The

Directors also express their gratitude and sincere

appreciation to all the employees of the Company for their

contribution, hard work and commitment.

For and on behalf of the Board of Directors

Pune Salil Taneja

August 14, 2015 Chairman


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INDUSTRY STRUCTURE AND DEVELOPMENT

The new Government has given a big thrust to domestic

defence production especially in private sector as part of

the ‘Make in India’ initiative of the Government. This of

course creates a great opportunity for companies like ours

which has been in defence business for past two decades.

Apart from manufacturing, the other activities of the

Company viz., Airfield and Air Charter Services (presently

being demerged) are linked more to overall economic activity.

DIVISION WISE PERFORMANCE *

(Rs. in Lakhs)

Particulars (TOTAL REVENUE) 2014-15 2013-14

AMM 1,044.22 2,668.71

Airfield 1,053.60 724.85

Aircharter 717.16 802.58

Trading 353.27 -

Total 3,168.25 4,196.14

* excluding performance of Engineering Design Services

division which was hived off w.e.f. August 1, 2013.

This was indeed a difficult year with over a 50% drop in the

core manufacturing business. This was largely due to delay

in finalisation of defence orders, some of which have since

been received. There were steady improvement in both Air

Charter and Air Field operations.

OPPORTUNITIES AND THREATS

The impetus given by the Government at the centre to the

defence sector as a whole, is expected to generate more

business opportunities to the industries in the days to come.

OUTLOOK

With thrust being given to “Make in India”, the Company

with its expertise would be in an advantageous situation in

its business operations.

RISKS AND CONCERNS

Aviation manufacturing with its complex nature and safety

aspects involving prolonged tests and trial procedure, results

in delayed implementation. This will have an impact on its

operations & business deliverables.

INTERNAL CONTROL SYSTEMS AND THEIR

ADEQUACY

The Company also recognizes need to strengthen the control

systems on an ongoing basis and is taking required steps

towards this objective.

FINANCIAL PERFORMANCE

The financial performance of the Company for FY 2014-15 as

compared to the previous period is given below:

(Rs. in Lakhs)

Particulars 2014-15 2013-14

Gross Income 3,527.00 5,472.05

Expenditure 3,786.01 4,705.98

Profit/ Loss before Interest, (259.01) 766.07

Tax, Depreciation and

Amortization

Profit/ (Loss) after Interest, Tax, (753.02) (132.10)

Depreciation and Extraordinary

Items

Earnings Per Share (3.02) (0.53)

The Company had to incur additional non recurring

expenditure of Rs. 2.48 Crore resulting in operating losses

for the year.

MATERIAL DEVELOPMENTS IN HUMAN RESOURCES/

INDUSTRIAL RELATIONS

The Company maintained good industrial relations with its

employees and staff. Human Resources remained a key focus

area for your Company during the year under review. As on

March 31, 2015, the Company had 483 employees.

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis

describing the Company’s expectations or predictions are

‘forward-looking statements’ within the meaning of

applicable securities laws and regulations. Actual results

could differ materially from those expressed or implied.

Important factors that could make a difference to the

Company’s operations include demand-supply conditions,

raw material prices, changes in Government regulations, tax

regime, economic developments within the country and other

factors such as litigation and labour negotiations.

Management Discussion and Analysis


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Corporate Governance Report

COMPANY’S PHILOSOPHY ON CODE OF GOVERNANCE

The Company has a strong value system comprising of honesty, integrity, secularity and equal opportunity for all. The

Company strives to provide its stakeholders with maximum information relating to the affairs of the Company with an attempt

to bring about total transparency in its working. We believe that good governance is the corner stone of any successful

organization and we continuously endeavor to improve our standards of governance.

BOARD OF DIRECTORS

The Board consists of 8 Directors of which 4 Directors are independent as on March 31, 2015.

The composition of the Board, their attendance at the Board Meetings held during the year and at the last Annual General

Meeting, the number of Directorships in other public companies and memberships in various committees across all public

companies as on March 31, 2015 are as follows:

Name of Category Financial Year No. of Directorships Committee positions

the Director 2014-15 in other public in other public

Attendance at companies^ companies$

Board Last Member Chairman

Meetings AGM

Salil Taneja* Promoter-ED 6 No 1 - -

S. M. Kapoor** MD - Yes - - -

C. S. Kameswaran@ NED 7 Yes 1 - -

B. R. Taneja Promoter-NED 4 No 1 - -

J. P. Sureka*** NED 5 No NA NA NA

R. Surie Independent-NED 8 Yes - - -

K. Rustumji Independent-NED 7 No - - -

R. Poornalingam^^ Independent-NED 2 No 2 - -

N. Chandra^^ Independent-NED 1 Yes - - -

NED-Non-Executive Director; ED-Executive Director; MD-Managing Director;

NA-Not Applicable

^ This does not include directorships in Private Limited Companies, Foreign Companies and Companies under Section

8 of the Companies Act, 2013 (Act).

$ This includes only Audit and Stakeholders Relationship Committees.

* Was Non-Executive Director from April 01, 2014 upto November 30, 2014 and appointed as Executive Director thereafter.

** Was appointed as the Managing Director w.e.f. December 01, 2014.

@ Was the Managing Director upto November 30, 2014 and continued as Non- Executive Director thereafter.

*** Ceased to be a Director w.e.f. December 02, 2014.

^^ Appointed as a Director w.e.f. November 13, 2014.


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During the year under review, Eight Board Meetings were

held as under:

Sr. No. Date of Meeting

1. May 28, 2014

2. July 16, 2014

3. August 09, 2014

4. September 26, 2014

5. October 09, 2014

6. November 13, 2014


8. February 13, 2015

As on March 31, 2015, the composition of the Board was in

conformity with Clause 49 of the Listing Agreement.

The Board has complete access to all the relevant

information available within the Company.

APPOINTMENT/ RE-APPOINTMENT OF DIRECTORS

In terms of the Articles of Association of the Company and

the relevant provisions of the Companies Act, 2013,

Mr. C. S. Kameswaran, Director of the Company retires by

rotation at the ensuing AGM and being eligible offers himself

for re-appointment.

Brief resume of the Directors proposed to be appointed/

re-appointed is given in the Notice convening the AGM.

AUDIT COMMITTEE

The terms of reference of the Audit Committee are in

conformity with the provisions of Section 177 of the

Companies Act, 2013 and the stipulations of Clause 49 of

the Listing Agreement with the Stock Exchange.

Composition, Meetings and Attendance during the year:

The composition of Audit Committee and attendance of

member is indicated alongside their names:

Name of Chairman / No. of

Director Member Meetings

Attended

R. Surie Chairman 6

J. P. Sureka* Member 4

K. Rustumji Member 6

R. Poornalingam** Member 2

N. Chandra** Member 1

* Director upto December 01, 2014.

** Appointed as member w.e.f. November 13, 2014.

During the year under review, Six Audit Committee Meetings

were held as under:


1. May 28, 2014

2. August 09, 2014

3. September 26, 2014

4. October 09, 2014



Mr. R. Surie, Chairman of the Audit Committee was present

at the last AGM.

MANAGERIAL REMUNERATION

a) NOMINATION AND REMUNERATION COMMITTEE

The Company has a Nomination and Remuneration

Committee of the Board of Directors.

The Nomination and Remuneration Committee is

empowered to fix, review and recommend the

remuneration payable to the Whole Time Director of the

Company from time to time including the annual increase

in his remuneration.


The composition of Nomination and Remuneration

Committee and attendance of each Member is indicated

alongside their names:



Attended

R. Poornalingam* Chairman 1

R. Surie Member 2


N. Chandra^ Member 1

J. P. Sureka** Member 1

* Appointed as Member and Chairman w. e. f. February 13,

2015

^ Appointed as Member w.e.f. February 13, 2015.

** Director upto December 01, 2014

During the year under review, Two Nomination and

Remuneration Committee Meetings were held as under:




The Company does not have any Employee Stock

Option Scheme.

Corporate Governance Report (Contd.)


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b) REMUNERATION POLICY:

Based on the recommendations of Nomination and

Remuneration Committee, the remuneration payable to

the Whole Time Director is decided by the Board which

inter-alia is based on the criteria such as industry bench-

marks, financial performance of the Company,

performance of the Whole Time Director etc.

The Company pays remuneration by way of salary,

perquisites and allowance to its Whole Time Director.

No remuneration was paid by way of commission to any

Non-Executive Director.

Non-Executive Directors were paid sitting fees of

Rs. 10,000/- each for attending Board and Committee

Meetings.

During the FY 2014-15, on recommendation of

Nomination and Remuneration Committee the Board had

approved the Nomination and Remuneration Policy.

c) REMUNERATION TO DIRECTORS:

A statement on the remuneration paid / payable to the

Whole Time Director and sitting fees paid to Non-

Executive Directors during the year under review is given

below:

Name of Director Salary & Sitting fees

Perquisites (Rs.) (Rs.)

Salil Taneja@ 32,05,000 50,000

R. Surie - 160,000

B. R. Taneja - 40,000

K. Rustumji - 200,000

C. S. Kameswaran* 19,56,907 -

J. P. Sureka^ - 120,000

R. Poornalingam** - 80,000

N. Chandra** - 50,000

S. M. Kapoor^^ 14,00,000 -

Total 67,61,907 7,00,000

^ Ceased to be Director w.e.f. December 02, 2014.

** Appointed as Director w.e.f. November 13, 2014.

^^ Was the Managing Director from December 01, 2014.

* Was the Managing Director from April 01, 2014 upto

November 30, 2014 and continued as Non-Executive

Director thereafter.

@ Appointed as a Whole-time Director w.e.f.

December 01, 2014.

Note: Salary and perquisites includes contribution to

Provident Fund and Superannuation, Leave Travel

Allowance, Medical Reimbursement.

Service of the Whole-time Directors may be terminated

by either party giving the other party notice as per the

notice period mentioned in their Agreement or the

Company paying salary for said notice period in lieu

thereof. There is no separate provision for payment of

severance fees

Details of shares of the Company held by its Non-

Executive Directors as on March 31, 2015 are given below:

Name of Director Number of Equity Shares

R. Surie 1,81,054

B. R. Taneja 300

K. Rustumji 200

C. S. Kameswaran -

R. Poornalingam -

N. Chandra 750

STAKEHOLDERS’ RELATIONSHIP COMMITTEE

The Company has a Stakeholders Relationship Committee

of the Board of Directors to look into the redressal of

shareholders’ and investors’ complaints relating to transfer

or credit of shares, non-receipt of Annual Reports/ dividends

etc.


The composition of Stakeholders Relationship Committee

and attendance of members is indicated alongside their

names:-



Attended

N. Chandra^ Chairman 1

J. P. Sureka* Member 2


C. S. Kameswaran Member 3

R. Poornalingam** Member 2

* Director upto December 01, 2014.

** Appointed as member w.e.f. November 13, 2014.

^ Appointed as member w.e.f. November 13, 2014 and as

Chairman w.e.f. February 13, 2015.

During the year under review, Four Committee Meetings

were held as under:


1. May 28, 2014

2. August 09, 2014



INDEPENDENT DIRECTORS’ MEETING:

During the year under review, the Independent Directors

met on March 18, 2015 in conformity with the stipulations in

Clause 49 of the Listing Agreement.



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COMPLIANCE OFFICER

Ms. Priya Nair, Company Secretary was the Compliance

Officer of the Company for ensuring compliance with the

requirements of the Listing Agreement with the Stock

Exchange and under SEBI (Prohibition of Insider Trading)

Regulations, 1992 as amended from time to time.

During the year under review all the complaints/ grievances

that were received from the shareholders/ investors, were

attended to and satisfactorily resolved. No valid transfer/

transmission of shares were pending as on March 31, 2015.

Details of investor complaints received and redressed during

the financial year 2014-15:

Number of complaints pending at the beginning Nil

of the year

Number of complaints received during the year 9

Number of complaints disposed of during 8

the year

Number of complaints remaining unresolved at 1

the end of the year

CODE OF CONDUCT

The Board has laid down a Code of Conduct for all Board

Members and Senior Management Personnel of the

Company. The Code of Conduct is posted on the website of

the Company.

CEO/ CFO CERTIFICATION

In accordance with Clause 49(IX) of the Listing Agreement,

the Chairman and the CFO have given their certificate to the

Board.

GENERAL BODY MEETINGS

Location and time of Annual General Meetings held in last 3

years:

Year Date Location Time No. of Special

Resolutions passed

2013-14 December Registered office 2.00 PM 5

30, 2014 at Belagondapalli

2012-13 September – do – – do – 1

30, 2013

2011-12 September – do – – do – -

28, 2012

Special resolution moved at the Annual General Meeting for

year 2012-13 was passed unanimously by show of hands.

The special resolutions moved at the Annual General

Meeting for year 2013-14 were passed with requisite majority

by way of e-voting and poll.

POSTAL BALLOT

Pursuant to Section 110 of the Companies Act, 2013 read

with the Companies (Management and Administration) Rules,

2014, the approval of Shareholders of the Company was

sought for passing the following Special Resolutions through

postal ballot process:

1. Special Resolution for creating charge etc. on

Company’s properties under Section 180(1)(a) of the

Companies Act, 2013;

2. Special Resolution for grant of loan(s)/ guarantee(s)/

security(ies) and make investment under Section 186 of

the Companies Act, 2013;

3. Special Resolution for Appointment and remuneration

of Mr. Salil Taneja as a Whole-time Director of the

Company with effect from December 1, 2014 to November

30, 2016.

4. Special Resolution for payment of remuneration to Mr.

C.S. Kameswaran, Non-Executive Director of the

Company with effect from February 1, 2015 to January

31, 2016.

Voting Pattern and Procedure for Postal Ballot:

a) The Board of Directors of the Company at its Meeting

held on February 13, 2015, had appointed Mr. Milind

Kasodekar, Partner, MRM Associates, Practicing

Company Secretary, as Scrutinizer for conducting the

postal ballot process in a fair and transparent manner.

The Postal Ballot Notice dated February 13, 2015 was

dispatched to the Shareholders of the Company on

February 26, 2015.

b) The last date for receipt of Postal Ballot Forms was March

28, 2015.

c) The Shareholders holding shares as on the “cut off”

date i.e. February 20, 2015 were entitled to vote through

either by e-voting or by means of postal ballot on the

proposed resolutions (item nos. 1 to 4) as set out in the

Notice of the Postal Ballot.

d) The e-voting period remained open from February 27,

2015 to March 28, 2015 (Both days inclusive).

e) The Scrutinizer had carried out the scrutiny of all the

postal ballot forms received from the Shareholders and

votes casted through electronic means upto 5.00 P.M.

on March 28, 2015 and submitted his report on March

31, 2015.

f) Further, 51 Shareholders voted through ballot process.



10

g) The results of the Postal Ballot were announced on

March 31, 2015 and were informed to the BSE Limited

where the Company’s shares are listed and also uploaded

on the website of the Company at www.taal.co.in.

h) All the Special Resolutions were passed with requisite

majority.

OTHER DISCLOSURES

(i) Details of related party transactions are furnished under

Notes to Financial Statement.

(ii) There were no instances of material non-compliances

and no strictures or penalties imposed on the Company

either by SEBI, Stock Exchange or any statutory

authorities on any matter related to capital markets

during the last three years.

(iii) Mr. B. R. Taneja, Director is father of Mr. Salil Taneja,

Chairman. Except as mentioned herein, none of the other

Directors have any relation inter-se.

MEANS OF COMMUNICATION

The quarterly results are published in one English daily

newspaper and one vernacular (Tamil) daily newspaper.

The quarterly results are also displayed on the website of

the Company at www.taal.co.in.

No presentations were made to Institutional Investors or to

the Analysts during the year under review.

DESIGNATED E-MAIL ID OF THE COMPANY

The Company has following E-mail ID exclusively for

investor servicing: [email protected]

GENERAL SHAREHOLDERS’ INFORMATION

AGM Date and Time Wednesday, September 30, 2015 at 2.00 p.m.

Venue Registered office at Belagondapalli

Financial Year April 1 to March 31

Date of Book Closure September 30, 2015

Listed on Stock Exchanges BSE Limited (Equity)

Luxembourg Stock Exchange (GDR)

Security Code (BSE) 522229

Security Code (Luxembourg) US 8753891089

ISIN allotted to equity shares INE692C01020

Registered Office & Belagondapalli Village, Thally Road,

Works/ Plant Location & Denkanikottai Taluk, Krishnagiri District,

Address for Correspondence Belagondapalli- 635114, Tamil Nadu

The Company has paid Listing Fees for the Financial Year

2015-16 to the BSE Limited where the Equity Shares of the

Company are listed.


STOCK MARKET DATA AND SHARE PRICE

PERFORMANCE

BSE LIMITED (BSE):

The performance of the Company’s scrip on the BSE as

compared to BSE 500 Index is as under:

Rs.

Market price BSE 500 INDEX

Month High Low High Low

April 2014 30.00 22.65 8,536.72 8,259.00

May 2014 33.40 23.10 9,578.21 8,296.19

June 2014 45.15 32.20 9,891.69 9,233.01

July 2014 44.80 35.10 10,055.76 9,460.05

August 2014 40.45 35.05 10,145.51 9,606.24

September 2014 48.90 37.70 10,478.05 9,972.19

October 2014 61.50 39.60 10,602.46 9,840.84

November 2014 60.35 48.20 10,997.43 10,583.35

December 2014 85.00 59.50 11,089.32 10,154.40

January 2015 73.80 61.00 11,544.40 10,457.44

February 2015 69.00 54.55 11,506.04 10,899.34

March 2015 64.45 50.40 11,764.80 10,733.92

Source: BSE website.

REGISTRAR AND SHARE TRANSFER AGENT

Shareholders may contact Registrar and Share Transfer

Agent at the following addresses:

Sharepro Services (India) Private Limited

13, AB Samhita Warehousing Complex, 2nd Floor,

Saki Naka Telephone Exchange Lane,

Off. Andheri Kurla Road, Saki Naka,

Andheri East, Mumbai - 400 072

Tel.: 91 - 022- 67720300/400

Fax.- 022- 28591568

e-mail:[email protected]

Sharepro Services (India) Private Limited

3, Chintamani Apartments,

Lane No.13, Off V. G. Kale Path

824/D, Bhandarkar Road

Pune - 411 004

Tel. +91-20-25662855

e-mail: [email protected]

As regard to the shareholding in electronic form

shareholders are requested to write to their respective

Depository Participant and provide Bank Mandate details,

N-ECS particulars, email ID etc. so as to facilitate expeditious

payment of Corporate Action, if any.

SHARE TRANSFER SYSTEM

The Equity Shares of the Company are traded compulsorily

in demat segment on the Stock Exchange. Shares received

for transfer in physical mode are processed and valid

transfers are approved within prescribed time limit.

Pursuant to Clause 47(c) of the Listing Agreement with the


11

Stock Exchange, certificate on half yearly basis were filed

with the BSE in due compliance of share transfer formalities

by the Company. In terms of guidelines issued by SEBI, the

Reconciliation of Share Capital Audit Report for all the

quarters were filed with the BSE, which inter-alia gives details

about the reconciliation of Share Capital (both physical and

demat).

SHAREHOLDING DISTRIBUTION OF THE COMPANY

AS ON MARCH 31, 2015:

Shareholding of No. of % to No. of % to

Nominal Share Total Shares Total

Value of Rs. Holder(s)

Upto 5,000 13,806 93.76 23,71,154 9.51

5,001 10,000 368 2.50 5,86,694 2.35

10,001 20,000 225 1.53 6,38,116 2.56

20,001 30,000 112 0.76 5,63,190 2.26

30,001 40,000 4 3 0.29 3,08,866 1.24

40,001 50,000 3 4 0.23 3,24,771 1.30

50,001 1,00,000 7 1 0.48 10,22,417 4.10

1,00,001 and above 6 6 0.45 1,91,15,528 76.68

Total 14,725 100.00 2,49,30,736 100.00

DEMATERIALISATION OF SHARES AND LIQUIDITY

96.06% of total Equity Share Capital is held in demat form

with NSDL and CDSL as on March 31, 2015.

DECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS AND SENIOR MANAGEMENT PERSONNEL WITH THE COMPANY’S CODE OF

CONDUCT, PURSUANT TO CLAUSE 49 OF THE LISTING AGREEMENT

As required by Clause 49(II)(E) of the Listing Agreement, this is to confirm that the Company has adopted a Code of Conduct for all Board Members and Senior Management

of the Company. The Code of Conduct is available on the Company’s website.

I confirm that the Company has in respect of Financial Year ended on March 31, 2015, received from the Senior Management Team of the Company and the Members of the

Board, a declaration of compliance with the Code of Conduct as applicable to them.

For the purpose of this declaration, Senior Management Team comprises of employees in the Vice President and above Cadre as on March 31, 2015.

For Taneja Aerospace and Aviation Limited

Pune Salil Taneja



CORPORATE FILINGS:

The financial and other information filed by the Company

with BSE (through BSE Listing Centre), from time to time is

available on the website of BSE Limited at www.bseindia.com.

OUTSTANDING GDRS/ ADRS/ WARRANTS OR ANY

CONVERTIBLE INSTRUMENTS, CONVERSION DATE

AND LIKELY IMPACT ON EQUITY:

The Company has not issued any ADRs/ Warrants or any

convertible instruments during the year under review,

however, the Company has 15,000 GDRs (equivalent to 30,000

Equity Shares) outstanding, which constituted 0.12% of the

Company’s total Equity Share Capital as on March 31, 2015.

PLANT LOCATIONS:

The Company has aircraft manufacturing and maintenance

facilities at the Factory at Belagondapalli Village, Thally Road,

Denkanikottai Taluk, Krishnagiri District, Belagondapalli -

635114, Tamil Nadu.

ADDRESS FOR CORRESPONDENCE:

Registered Office at Belagondapalli Village, Thally Road,

Denkanikottai Taluk, Krishnagiri District, Belagondapalli -

635114, Tamil Nadu.

For Taneja Aerospace and Aviation Limited

Pune Salil Taneja


AUDITORS’ CERTIFICATE ON COMPLIANCE OF CONDITIONS OF CORPORATCE GOVERNANCE

To

The Members of Taneja Aerospace and Aviation Limited

We have examined all relevant records of Taneja Aerospace and Aviation Limited (the”Company”) for the purpose of certifying compliance of the conditions of Corporate

Governance under Clause 49 of the Listing Agreement with BSE Limited (Stock Exchange) for the financial year ended March 31, 2015, We have obtained all the information

and explanations which to the best of our knowledge and belief were necessary for the purpose of certification.

The compliance of conditions of Corporate Governance is the responsibility of the management.

Our examination has been limited to the procedures and implementation thereof, this certificateis neither an assurance as to the future viability of the Company nor of the

efficacy or effectiveness with which the management has conducted the affairs of the Company.

On the basis of our examination of the records produced, explanations and information furnished, we certify that the Company has complied with all the mandatory conditions

of the said Clause 49 of the Listing Agreement, except for compliance of Clause 49 part V to the extent of appointment of Independent Director on the Board of Material non-

listed Indian Subsidiary.

For MRM ASSOCIATES

COMPANY SECRETARIES

CS M B KASODEKAR

PARTNER

Unique Code of Partnership Firm: P2001MH006700

Place: Pune Membership No. F 2756

Date: August 13,2015 C. P. No: 1681


12

Extract of Annual Return as on the financial year ended on March 31, 2015

[Pursuant to section 92(3) of the Companies Act, 2013 and rule 12(1) of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS:

i) CIN L62200TZ1988PLC014460

ii) Registration Date 22/07/1988

iii) Name of the Company Taneja Aerospace and Aviation Limited

iv) Category/ Sub-Category Company limited by shares/ Indian Non-Government Company

v) Address of the Registered office & Belagondapalli Village, Thally Road, Denkanikotta,

contact details Belagondapalli-635114 (Tamil Nadu)

Tel.: +91 (04347) 233508

e-mail: [email protected]

vi) Whether listed company Yes

vii) Name, Address & Contact details of Sharepro Services (India) Private Limited

Registrar & Transfer Agent, if any 3, Chintamani Apartments, Lane No. 13, Off V.G. Kale Path,

824/D, Bhandarkar Road, Pune-411004.

Tel.: +91-20-25662855

e-mail:[email protected]

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY:

All the business activities contributing 10% or more of the total turnover of the Company:-

Sr. Name and Description of NIC Code of % to total turnover

No. main products/ services the Product/ service of the Company

1 AMM 30305 32.96

2 Airfield 52231 33.25

3 Aircharter 51101 22.64

4 Trading 46593 11.15

Annexure ‘A’ to the Directors Report


CEO/CFO CERTIFICATION TO THE BOARD

(Under Clause 49 (IX) of Listing Agreement)

To

The Board of Directors


We, Salil Taneja, Whole-time Director and Ajay Gupta, Chief

Financial Officer of Taneja Aerospace and Aviation Limited,

to the best of our knowledge and belief, certify that:

(1) We have reviewed the financial statements and the cash

flow statement for the year ended March 31, 2015 and

that to the best of our knowledge and belief:

(i) these statements do not contain any materially

untrue statement or omit any material fact or contain

statements that might be misleading;

(ii) these statements together present a true and fair

view of the Company’s affairs and are in compliance

with existing accounting standards, applicable laws

and regulations.

(2) There are, to the best of our knowledge and belief, no

transactions entered into by the Company during the

year which are fraudulent, illegal or violative of the

Company’s Code of Conduct.

(3) We accept the responsibility for establishing and

maintaining internal controls for financial reporting and

that we have evaluated the effectiveness of the internal

control systems of the Company pertaining to the

financial reporting and we have disclosed to the auditors

and the Audit Committee, deficiencies in the design or

operation of such internal controls, if any, of which we

are aware and the steps we have taken or propose to

take to rectify these deficiencies.

(4) We have indicated to the Auditors and the Audit

Committee:

(i) there are no significant changes in internal control

over financial reporting during the financial year

ended March 31, 2015;

(ii) all significant changes in accounting policies during

the financial year ended March 31, 2015 and that

the same have been disclosed in the notes to the

financial statements; and

(iii) there are no instances of significant fraud of which

we have become aware and the involvement therein,

if any, of the management or an employee having a

significant role in the Company’s internal control

system over financial reporting.

Salil Taneja Ajay Gupta

Pune Whole-time Chief Financial

August 14, 2015 Director Officer


13

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES:

S. Name and address of CIN/ GLN Holding/ % of Applicable

No. the Company Subsidiary/ Shares Section

Associate Held*

1 TAAL Tech India Pvt. Ltd. U74900KA2012PTC067450 Subsidiary 85 2(87)

GGR Tower, 2nd Floor, Sy# 18/2b,

Ambalipura Village, Sarjapur Road,

Bellandur Gate, Bangalore-560103

2 TAAL Enterprises Ltd. U62200TN2014PLC096373 Subsidiary 100 2(87)

2nd Floor, MMPDA Towers,

184, Royapettah High Road,

Chennai-600014

3 Katra Auto Engineering Pvt. Ltd. U50300TN2007PTC062038 Subsidiary 100 2(87)

MMPDA Towers, 2nd Floor,

Royapettah High Road,

Chennai-600014

4 First Airways Inc. NA Subsidiary 100 2(87)

160, Greentree Drive, Suite 101,

City of Dover, County of Kent,

DE, 19904

5 TAAL Technologies Inc., USA NA Subsidiary 100 2(87)

160, Greentree Drive, Suite 101,

City of Dover, County of Kent,

DE, 19904

6 TAAL Aerosystems Pvt. Ltd. U62200TN2010PTC078551 Associate 30 2(6)

2nd Floor, MMPDA Towers, 184,

Royapettah High Road,

Chennai-600014

* Representing Aggregate % of shares held by the Company and/ or its subsidiaries.

IV. SHARE HOLDING PATTERN

(Equity Share Capital Breakup as percentage of Total Equity)

i) Category-wise Share Holding

Category of Shareholders No. of Shares held at No. of Shares held at % Change

the beginning of the year the end of the year during

the year

Demat Physical Total % of Demat Physical Total % of

Total Total

Shares Shares

A. Promoters

(1) Indian

a) Individual/ HUF 32500 - 32500 0.13 32500 - 32500 0.13 -

b) Central Government - - - - - - - - -

c) State Government(s) - - - - - - - - -

d) Bodies Corporate 12699516 - 12699516 50.94 12699516 - 12699516 50.94 -

e) Banks / FI - - - - - - - - -

f) Any other - - - - - - - - -

Sub-total (A) (1):- 12732016 - 12732016 51.07 12732016 - 12732016 51.07 -

(2) Foreign

a) NRIs-Individuals - - - - - - - - -

b) Other-Individuals - - - - - - - - -

c) Bodies Corporate - - - - - - - - -

d) Banks/ FI - - - - - - - - -

e) Any other - - - - - - - - -

Sub-total (A) (2):- - - - - - - - - -

Total shareholding of 12732016 - 12732016 51.07 12732016 - 12732016 51.07 -

Promoter (A)=

(A)(1)+(A)(2)

B. Public Shareholding

1. Institutions

a) Mutual Funds - - - - - - - - -

b) Banks / FI - 300 300 0.00 0 300 300 0.00 -

c) Central Government - - - - - - - - -

d) State Government(s) - - - - - - - - -

e) Venture Capital Funds - - - - - - - - -

f) Insurance Companies - - - - - - - - -

g) FIIs 1405192 - 1405192 5.64 1793523 0 1793523 7.19 1.55

h) Foreign Venture Capital - - - - - - - - -

Funds

i) Others (specify) - - - - - - - - -

Sub-total (B)(1):- 1405192 300 1405492 5.64 1793523 300 1793823 7.19 1.55


14

Category of Shareholders No. of Shares held at No. of Shares held at % Change

the beginning of the year the end of the year during

the year

Demat Physical Total % of Demat Physical Total % of

Total Total

Shares Shares

2. Non-Institutions

a) Bodies Corporate

i) Indian 1340948 117201 1458149 5.85 1872373 117201 1989574 7.98 2.13

ii) Overseas - - - - - - - - -

b) Individuals

i) Individual shareholders 4533868 880656 5414524 21.72 4364383 864676 5229059 20.97 -0.75

holding nominal share

capital upto Rs. 1 lakh

ii) Individual shareholders 2809909 - 2809909 11.27 2960116 - 2960116 11.87 0.6

holding nominal share

capital in excess of

Rs 1 lakh

c) Others (specify):-

c) (1) Trusts 7500 - 7500 0.03 7500 - 7500 0.03 -

c) (2) Non-Residents 522946 200 523146 2.10 188448 200 188648 0.76 -1.34

Sub-total (B)(2):- 10556119 1115258 11671377 40.97 11265193 982077 12364471 41.61 0.64

Total Public

Shareholding (B)=

(B)(1)+ (B)(2) 11961311 1115558 13076869 46.60 11186343 982377 12168720 48.81 2.2

C. Shares held by Custodian

for GDRs & ADRs

Public 580000 - 580000 2.33 30000 - 30000 0.12 -2.21

Sub-total (C) 580000 - 580000 2.33 30000 - 30000 0.12 -2.21

Grand Total (A+B+C) 23932379 998357 24930736 100.00 23948359 982377 24930736 100.00 -

ii. Shareholding of Promoters

Sr. Shareholder’s Shareholding at Shareholding at % Change

No. Name the beginning of the year the end of the year In share

holding

During

the year

No. of % of total % of Shares No. of % of total % of Shares

Shares Shares of Pledged / Shares Shares of Pledged /

the Encumbered the Encumbered

company to total company to total

shares shares

1 Indian Seamless Enterprises Ltd 10964620 43.98 2.01 10964620 43.98 7.20 -

2 Vishkul Leather Garments Pvt. Ltd 1689179 6.78 - 1689179 6.78 6.30 -

3 Lighto Technologies Pvt Ltd 45717 0.18 - 45717 0.18 - -

4 Salil Baldev Taneja 3200 0.01 - 3200 0.01 - -

5 Baldevraj Topanram Taneja 300 0.00 - 300 0.00 - -

6 Alka P Mehta 29000 0.12 - 29000 0.12 - -

Total 12732016 51.07 2.01 12732016 51.07 13.50 -

iii. Change in Promoters’ Shareholding ( please specify, if there is no change) : No change during the year

iv. Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

Sr. Name Shareholding Dates Increase / Reason Cumulative

No. Decrease in Shareholding

shareholding during the year

No. of % of No. of % of

Shares at total Shares total

the beginning shares shares

(01.04.2014 / of the of the

end of year company company

31.03.2015)

1 Bridge India Fund 1164897 4.67 01.04.2014 1084625 Purchase 2249522 9.02

28.04.2014 -1164897 Sale 1084625 4.35

1084625 4.35 31.03.2015

2 Tara Jain 247800 0.99 01.04.2014 NA NA 247800 0.99

247800 0.99 31.03.2015 247800 0.99

3 Hindustan Candle 223849 0.90 01.04.2014 -7552 Sale 216297 0.87

Mfg.Co. Pvt.Ltd. 16.06.2014 -16000 Sale 200297 0.80

13.10.2014 -20000 Sale 180297 0.72

01.12.2014 -20000 Sale 160297 0.64

160297 0.64 31.03.2015


15

Sr. Name Shareholding Dates Increase / Reason Cumulative

No. Decrease in Shareholding

shareholding during the year




(01.04.2014 / of the of the


31.03.2015)

4 Orange Mauritius 240295 0.96 01.04.2014 NA NA NA NA

Investments 08.12.2014 -50295 Sale 190000 0.76

Limited 15.12.2014 518898 Purchase 708898 2.84

708898 2.84 31.03.2015

5 Bhagwandas K 194700 0.78 01.04.2014 NA NA NA NA

Sahu 11.08.2014 10300 Purchase 205000 0.82

15.09.2014 5787 Purchase 210787 0.85

210787 0.85 31.03.2015

6 Prakash Chandra 125000 0.50 01.04.2014 NA NA NA NA

Modi 24.11.2014 75000 Purchase 200000 0.80

08.12.2014 27600 Purchase 227600 0.91

227600 0.91 31.03.2015

7 Bas Engineering 0 0.00 01.04.2014 NA NA NA NA

Pvt Ltd 09.06.2014 25590 Purchase 25590 0.10

23.06.2014 5000 Purchase 30590 0.12

30.06.2014 13016 Purchase 43606 0.17

08.09.2014 466347 Purchase 509953 2.05

08.12.2014 23977 Purchase 533930 2.14

533930 2.14 31.03.2015

8 Vikrant Puri 0 0.00 01.04.2014 NA NA NA NA

03.11.2014 77584 Purchase 77584 0.31

10.11.2014 38656 Purchase 116240 0.47

17.11.2014 21342 Purchase 137582 0.55

08.12.2014 45016 Purchase 182598 0.73

15.12.2014 56621 Purchase 239219 0.96

239219 0.96 31.03.2015

9 Utkarsh Munot 104364 0.42 01.04.2014 NA NA NA NA

07.04.2014 20000 Purchase 124364 0.50

14.04.2014 10000 Purchase 134364 0.54

05.05.2014 1021 Purchase 135385 0.54

07.07.2014 12711 Purchase 148096 0.59

14.07.2014 3625 Purchase 151721 0.61

26.01.2015 10000 Purchase 161721 0.65

161721 0.65 31.03.2015

10 Gujarat Fluoro 365559 1.47 01.04.2014 -69839 Sale 295720 1.19

chemicals Ltd. 07.04.2014 -126478 Sale 169242 0.68

14.04.2014 -169242 Sale 0 0.00

0 0.00 31.03.2015

11 Neeta Jatin Jhaveri 250000 1.00 01.04.2014 NA NA 250000 1.00

250000 1.00 31.03.2015 250000 1.00

12 Radhe Mohan 338431 1.36 01.04.2014 25660 Purchase 364091 1.46

Kapur 21.04.2014 2400 Purchase 366491 1.47

28.04.2014 18306 Purchase 384797 1.54

19.05.2014 23800 Purchase 408597 1.64

28.05.2014 57750 Purchase 466347 1.87

01.09.2014 -466347 Sale 0 0.00

0 0.00 31.03.2015 0 0.00

13 Mitali Duttkakar 119774 0.48 01.04.2014 NA NA NA NA

09.06.2014 -1500 Sale 118274 0.47

08.09.2014 -3275 Sale 114999 0.46

15.09.2014 -1725 Sale 113274 0.45

113274 0.45 31.03.2015


16

v. Shareholding of Directors and Key Managerial Personnel:

Sr. For Each of the Shareholding Dates Increase / Reason Cumulative

No. Directors and Decrease in Shareholding

KMP shareholding during the year

(01.04.2014 to

31.03.2015)




(01.04.2014 / of the of the


31.03.2015)

1 Mr. Salil Taneja - 3200 0.01 01.04.2014 NA NA 3200 0.01

ED 3200 0.01 31.03.2015 3200 0.01

2 Mr. R. Surie- 181054 0.73 01.04.2014 181054 0.73

Independent -NED 181054 0.73 31.03.2015 181054 0.73

3 Mr. B.R.Taneja- 300 0.001 01.04.2014 300 0.001

NED 300 0.001 31.03.2015 300 0.001

4 Mr. K. Rustumji- 200 0.0008 01.04.2014 200 0.0008

Independent -NED 200 0.0008 31.03.2015 200 0.0008

5 Mr. C. S. 0 0 01.04.2014 0 0

Kameswaran-NED 0 0 31.03.2015 0 0

6 Mr. J. P. Sureka*- 250 0.001 01.04.2014 250 0.001

NED 250 0.001 31.03.2015 250 0.001

7 Mr. R. 0 0 01.04.2014 0 0

Poornalingam^- 0 0 31.03.2015 0 0

Independent–NED

8 Mr. Nirmal 750 0.003 01.04.2014 750 0.003

Chandra^- 750 0.003 31.03.2015 750 0.003

Independent -NED

9 Mr. S. M. Kapoor- 0 0 01.04.2014 0 0

Managing Director 0 0 31.03.2015 0 0

10 Ms. Priya Nair- 0 0 01.04.2014 0 0

Company Secretary 0 0 31.03.2015 0 0

11 Mr. Ajay Gupta - 0 0 01.04.2014 0 0

Chief Financial 0 0 31.03.2015 0 0

Officer

*Ceased to be Director w.e.f. December 02, 2014

^ Appointed as Director w.e.f. November 13, 2014

V. INDEBTEDNESS

Indebtedness of the Company including interest outstanding/ accrued but not due for payment

Rs. In Lacs

Secured Loans Unsecured Deposits Total

excluding deposits Loans Indebtedness

Indebtedness at the beginning of -

the financial year

i) Principal Amount 4777.93 655 848.03 6280.96

ii) Interest due but not paid -

iii) Interest accrued but not due -

Total (i+ii+iii) 4777.93 655 848.03 6280.96

Change in Indebtedness during

the financial year -

*Addition 800.00 2336 3136

Reduction 1303.74 2991 - 4294.74

Net Change (503.74) (655) - (1158.74)

Indebtedness at the end of the financial year -

i) Principal Amount 4253.27 849.03 5102.31

ii) Interest due but not paid 20.92 - 20.92

iii) Interest accrued but not due

Total (i+ii+iii) 4274.19 849.03 5123.23


17

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL

A. Remuneration to the Managing Director(MD), Whole-time Directors(WTD) and/ or Manager: (Rs. in Lacs)

Sr. Particulars of Remuneration Name of MD/ WTD/ Manager Total Amount

no.

S.M.Kapoor- Salil Taneja- C S Kameswaran-

MD* WTD^ MD$

1 Gross salary

(a) Salary as per provisions contained in 14.00 32.05 19.57 65.62

section 17(1) of the Income-tax Act, 1961

(b) Value of perquisites u/s 17(2) of the - - - -

Income-tax Act, 1961

(c) Profits in lieu of salary under section 17(3) of the - - - -

Income- tax Act, 1961

2 Stock Option - - - -

3 Sweat Equity - - - -

4 Commission- as % of profit- - - - -

5 Others, please specify - - - -

Total (A) 14.00 32.05 19.57 65.62

Ceiling as per the Act**

* Appointed as the Managing Director w.e.f. December 01, 2014

^ Re-designated as Whole-time Director w.e.f. December 01, 2014

$ Remuneration as the Managing Director upto November 30, 2014

** Limit of remuneration shall be in terms of scheudule V to the Companies Act, 2013 and excludes contribution by the Company to providend fund.

B. Remuneration to other directors: (Rs. in Lacs)

Sr. Particulars of Remuneration Name of Directors Total Amount

no.

R. B.R. K. J.P. C.S. Nirmal R. Salil

Surie Taneja Rustumji Sureka Kameswaran Chandra Poornalingam Taneja

1 Independent Directors

Fee for attending board/ committee meetings 1.60 - 2.00 1.20 - 0.50 0.80 - 6.10

Commission - - - - - - - - -

Others, please specify - - - - - - - - -

Total (1) 1.60 - 2.00 1.20 - 0.50 0.80 - 6.10

2 Other Non-Executive Directors

Fee for attending board / committee meetings - 0.40 - - - - - 0.50 0.90

Commission - - - - - - - - -

Others, please specify - - - - - - - - -

Total (2) - 0.40 - - - - - 0.50 0.90

Total (B)=(1+2) - - - - - - - - 7.00

Total Managerial Remuneration (A+B) - - - - - - - - 72.62

Overall Ceiling as per the Act - - - - - - - - NA

C. Remuneration to Key Managerial Personnel other than MD/ Manager/ WTD (Rs. in Lacs)

Sr. Particulars of Remuneration Key Managerial Personnel Total Amount

no.

Priya Nair- Ajay Gupta-

Company Secretary CFO

1 Gross salary

(a) Salary as per provisions contained in section 17(1) 8.31 6.80 15.11

of the Income-tax Act, 1961

(b) Value of perquisites u/s 17(2) Income-tax Act, 1961 - - -

(c) Profits in lieu of salary under section 17(3) - - -

Income-tax Act, 1961

2 Stock Option - - -

3 Sweat Equity - - -

4 Commission - - -

- as % of profit - - -

others, specify… - - -

5 Others, please specify - - -

Total 8.31 6.80 15.11

VII. PENALTIES/ PUNISHMENT/ COMPOUNDING OF OFFENCES : NIL


18

Details pertaining to remuneration pursuant to Section 197(12) of the Companies Act, 2013 read with Rules thereunder:

1) The percentage increase in remuneration of each Director, Chief Financial Officer and Company Secretary in the financial year 2014-15, Ratio of remuneration of each

Director to median remuneration of employees of the Company for the financial year 2014-15 and the comparison of the remuneration of the Key Managerial Personnel

(KMP) against the performance of the Company–

Sr. No. Name of Directors/ Remuneration of % increase in Ratio of Comparison of the

KMP and Designation Directors/ KMP remuneration remuneration of remuneration of

for financial in FY 2014-15 Director to median KMP against the

year 2014-15 remuneration of performance of

(Rs. in Lacs) employees the Company

1 Salil Taneja, 32.05 N.A.* 15 : 1

Whole-time Director

2 C S Kameswaran, 19.57 N.A.^ 9 : 1

Managing Director

3 S M Kapoor 14.00 N.A.^^ 7 : 1

Managing Director

4 Ajay Gupta 6.80 N.A.$ N.A.

Chief Financial Officer

5 Priya Nair, 8.31 7.06 N.A.

Company Secretary

* Mr. Salil Taneja was a Non-Executive Director only for part of the financial year 2014-15 i.e. upto November 30, 2014 and was appointed as Whole-time

Director of the Company w.e.f. December 01, 2014.

^ Mr. C S Kameswaran was the Managing Director only for part of the financial year 2014-15 i.e. upto November 30, 2014 and continued as Non-Executive

Director thereafter.

^̂ Mr. S M Kapoor was appointed as the Managing Director during the financial year 2014-15 i.e. on December 01, 2014.

$ Details not given as Mr. Ajay Gupta was appointed as CFO during the financial year 2014-15 i.e. on November 13, 2014.

2) The median remuneration of employees of the Company during the financial year was Rs. 2.13 Lacs p.a.

3) In the financial year under review, there was a decrease of 5.21% in the median remuneration of employees.

4) There were 151 permanent employees on the roll of the Company as on March 31, 2015.

5) Relationship between average increase in remuneration & company performance-

Income of the Company reduced by 35% in the financial year 2014-15 whereas, the average increase in remuneration was 2.37%. The average increase in remuneration

was lower on account of drop in performance of the Company.

6) The market capitalization of the Company as on March 31, 2015 was Rs. 14,098 Lacs (Rs. 7,566 Lacs as on March 31, 2014).

7) Price Earnings Ratio of the Company as on March 31, 2015 was (18.73) and as at March 31, 2014 was (57.26).

8) The market quotations of shares of the Company as on March 31, 2015 was Rs. 56.55 (face value Rs. 5 per share). The last public offer made by the Company in the

year 1994 was at face value of Rs. 10 per share at par. Hence, there was increase in market quotations of shares by 465% as on March 31, 2015 in comparison to rate

of last public offer.

9) Average decrease in the salaries of employees other than the managerial personal in the last financial year was 1.62% whereas the increase in the managerial

Annexure ‘C’ to the Directors Report

Information required under Section 134(3)(m) of the Companies Act, 2013 read

with the Companies (Accounts), Rules, 2014 for the Financial Year Ended on

March 31, 2015.

I. Conservation of energy:

i. The steps taken or impact on conservation of energy: Harmonic filter

installed at powerhouse which reduces the power loss.

The Company is basically a low energy consumer. During the year under

review, approx. 9.5 lacs units of energy were consumed, costing Rs.

76.99 lacs.

Minimizing environmental pollution by reducing carbon discharge to

the atmosphere with reduced running of diesel or engine driven power

sources.

ii. The steps taken by the Company for utilizing alternate sources of energy:

a) Planning solar panel power systems for security lights in future;

b) Planning solar panel energy source as stand-by resource for non-

industrial loads;

c) Using 250KVA genset only in case of emergency.

iii. The capital investment on energy conservation equipment’s: Nil

II. Technology absorption:

i. The efforts made towards technology absorption:

A) Launcher:

The Company has successfully developed complete tooling for

SR Launcher Assembly.

B) Litening Pod:

The Company has successfully developed complete tooling for

SR Launcher Assembly.

C) The development work carried out on IL 38 A/C of Indian Navy:

The Company has successfully integrated the Satcom, RLG & NT

on IL 38 type of Aircraft.

ii. The benefits derived like product improvement, cost reduction, product

development or import substitution:

Better Quality, minimized rejections, improved production throughput,

operator’s knowledge enhancement and skill improvement, increased

indigenization efforts for DPSUs, and armed services (IN & IAF).

iii. In case of imported technology (imported during the last three years

reckoned from the beginning of the financial year)-

a. The details of technology imported- Nil

b. The year of import- Nil

c. Whether the technology been fully absorbed- Nil

d. If not fully absorbed, areas where absorption has not taken place,

and the reasons thereof- Nil

iv. The expenditure incurred on Research and Development.

(Rs. in Lakhs)

Sr. No. Particulars 2014-15 2013-14

i) Capital Expenditure Nil 29.32

ii) Recurring Expenditure 17.03 19.76

Total 17.03 49.07

Total R&D as a percentage to 0.48 0.90

turnover

III. Foreign exchange earnings and Outgo:

a) Activities relating to exports, initiatives taken to increase export,

development of new export market for products and export plans.

The Company has taken initiative to execute export program that willresult in earning of foreign exchange.

b) The information on foreign exchange earnings and outgo are contained

in Notes to the Accounts.

Annexure ‘B’ to the Directors Report

Income of the Company

reduced by 35% in the

financial year

2014-15


19

remuneration for the same financial year was 145%. The increase in managerial remuneration was on account of increase in number of managerial personnel during

the financial year 2014-15.

10) Statement showing details of employee in receipt of remuneration aggregating to Rs. 5 lacs per month and above:

Name of Designation Age Remuneration Qualifications Experience Date of Last

the Employee (Yrs.) (Rs. in Lacs) (Years) commencement employment

of employment held

Salil Taneja Whole-time 48 32.05 B.Sc. (Engg.), 25 December 01, 2014 ISMT Limited

Director MBA (Fin.),

Ohio, Yale, USA

11) It is hereby affirmed that the remuneration is as per the Remuneration Policy of the Company.

Secretarial Audit Report for the financial year ended March 31, 2015

[Pursuant to section 204(1) of the Companies Act, 2013 and Rule No.9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To,

The Members,TANEJA AEROSPACE AND AVIATION LTDBelagondapalli Village, Thally Road, Denkanikotta, Belagondapalli,Tamil Nadu 635114

We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by TANEJA AEROSPACE

AND AVIATION LTD (hereinafter called the company). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporateconducts/statutory compliances and expressing our opinion thereon.

Based on our verification of the books, papers, minute books, forms and returns filed and other records maintained by the company and also the information provided by thecompany, its officers, agents and authorized representatives during the conduct of secretarial audit, We hereby report that in our opinion, the company has, during the auditperiod covering the financial year ended on 31st March, 2015, complied with the statutory provisions listed hereunder and also that the Company has proper Board-processesand compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

We have examined the books, papers, minute books, forms and returns filed and other records maintained by the Company for the financial year ended 31st March, 2015,according to the provisions of:

i) The Companies Act, 2013 (the Act) and the rules made thereunder;

ii) The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made thereunder;

iii) The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder;

iv) Foreign Exchange Management Act, 1999 and the rules and regulations made thereunder to the extent of Foreign Direct Investment, Overseas Direct Investment andExternal Commercial Borrowings;

v) The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’):-

i) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

ii) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992;

iii) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;

iv) The Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999;

v) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;

vi) The Securities & Exchange Board of India (Registrars to an Issue & Share Transfer Agents) Regulations, 1993 regarding Companies Act & dealing with client;

vii) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009; and

viii) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998;

vi) As informed to us Aircraft Act, 1934 is specifically applicable to the company.

We have also examined compliance with the applicable clauses of the following:

(i) The Listing Agreement entered into by the Company with Bombay Stock Exchange;

During the period under review the Company has complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards, etc. mentioned above subjectto the following observations:

A. Companies Act, 2013:

a) The Company has not complied with provisions of Section 149 (4) of the Companies Act, 2013. The Company do not have one third of total strength of directorsas Independent Directors.

b) The Company has not complied with provisions of Section 149 (1) of the Companies Act, 2013 with respect to appointment of Woman director.

B. Listing Agreement :

Clause 49 Part V to the extent of appointment of Independent Director on the Board of Material non-listed Indian Subsidiary is not complied with.

We further report that

The Board of Directors of the Company is duly constituted,except for appointments as mentioned above, with proper balance of Executive Directors and Non-ExecutiveDirectors.

Adequate notice is given to all directors to schedule the Board Meetings, agenda and detailed notes on agenda were sent at least seven days in advanceexcept for the oneBoard Meeting which was held at shorter Notice and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meetingand for meaningful participation at the meeting.

Majority decision is carried through and recorded as part of the minutes.

We further report that there are adequate systems and processes in the company commensurate with the size and operations of the company to monitor and ensure compliancewith applicablelaws, rules, regulationsand guidelines.

We further report that during the audit period the approval of the members of the company is accorded:

1. As per the provisions under Section 180 (1) (c) of the Companies Act, 2013, to borrow monies where the monies to be borrowed together with the monies alreadyborrowed by the Company exceeds the aggregate of the paid up capital of the Company and its free reserves provided that the total amount so borrowed shall notat any time exceed Rs.150 Crore (Rupees One Hundred and Fifty Crore Only).

2. As per the provisions under Section 180 (1)(a) of the Companies Act, 2013, for creation of charge /mortgage/ hypothecation to secure financial liabilities to the extentof Rs.150 Crore (Rupees One Hundred and Fifty Crore Only).

For MRM ASSOCIATES

COMPANY SECRETARIES

CS M B KASODEKAR

PARTNER

Unique Code of Partnership Firm: P2001MH006700

Place: Pune Membership No. F 2756

Date: August 13,2015 C. P. No: 1681

Annexure ‘D’ to the Directors Report


20

To the Members of TANEJA AEROSPACE AND AVIATION

LIMITED

Report on the Standalone Financial Statements

We have audited the accompanying standalone financial statements

of Taneja Aerospace and Aviation Limited (“the Company”), which

comprise the Balance Sheet as at March 31, 2015, the Statement of

Profit and Loss, the Cash Flow Statement for the year then ended,

and a summary of significant accounting policies and other

explanatory information.

Management’s Responsibility for the Standalone Financial

Statements

The Company’s Board of Directors is responsible for the matters

stated in Section 134(5) of the Companies Act, 2013 (“the Act”)

with respect to the preparation of these standalone financial

statements that give a true and fair view of the financial position,

financial performance and cash flows of the Company in accordance

with the accounting principles generally accepted in India, including

the Accounting Standards specified under Section 133 of the Act,

read with Rule 7 of the Companies (Accounts) Rules, 2014. This

responsibility also includes maintenance of adequate accounting

records in accordance with the provisions of the Act for safe guarding

the assets of the Company and for preventing and detecting frauds

and other irregularities; selection and application of appropriate

accounting policies; making judgments and estimates that are

reasonable and prudent; and design, implementation and maintenance

of adequate internal financial controls, that were operating effectively

for ensuring the accuracy and completeness of the accounting records,

relevant to the preparation and presentation of the financial

statements that give a true and fair view and are free from material

misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these standalone

financial statements based on our audit.

We have taken into account the provisions of the Act, the accounting

and auditing standards and matters which are required to be included

in the audit report under the provisions of the Act and the Rules made

thereunder.

We conducted our audit in accordance with the Standards on Auditing

specified under Section 143(10) of the Act. Those Standards require

that we comply with ethical requirements and plan and perform the

audit to obtain reasonable assurance about whether the financial

statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence

about the amounts and disclosures in the financial statements. The

procedures selected depend on the auditor’s judgment, including the

assessment of the risks of material misstatement of the financial

statements, whether due to fraud or error. In making those risk

assessments, the auditor considers internal financial control relevant

to the Company’s preparation of the financial statements that give

a true and fair view in order to design audit procedures that are

appropriate in the circumstances, but not for the purpose of expressing

an opinion on whether the Company has in place an adequate internal

financial controls system over financial reporting and the operating

effectiveness of such controls. An audit also includes evaluating the

appropriateness of accounting policies used and the reasonableness

of the accounting estimates made by the Company’s Directors, as

well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and

appropriate to provide a basis for our qualified audit opinion on the

standalone financial statements.

Independent Auditor’s Report

Basis for Qualified Opinion

1) The Company has debited Rs. 34.74 Lakhs under

advertisement and travelling expenses being

reimbursement to a group company for which no

evidence/supporting is provided. This has resulted in

overstatement of loss for the year and understatement of

amount receivable from the group company by Rs. 34.74

Lakhs.

2) The Company during the year commenced the business

of trading in electrical goods (Refer Note No. 38) where

in sales are only to LightO Technologies Private Limited

(a related party). Further, the Company also gave Inter

Corporate Deposit to the said related party which was in

excess of the amount approved by the audit committee by

Rs.185 Lakhs. As at March 31, 2015, the Company has to

receive Rs. 256.31 Lakhs against sale of goods and Rs.

688.84 Lakhs (including interest) against Inter Corporate

Deposit. We were not provided with sufficient and

appropriate audit evidence about the recoverability of

the above amounts. Consequently, we are unable to

determine whether any adjustments to these amounts

are necessary.

3) We draw attention to Note No. 36 forming part of the

standalone financial statements, which refers to the fact

that the shareholders of the Company at their meeting

(convened on the directions of the Hon’ble High Court of

Madras) held on April 15, 2015 have approved the Scheme

of Arrangement between the Company and TAAL

Enterprises Limited, a wholly owned subsidiary of the

Company w.e.f. October 1, 2014 subject to receipt of

regulatory approvals. Further, the above mentioned note

also refers to the proposed Reduction in Share Capital of

the Company as a consequence of the said Scheme, the

terms of which were approved by the shareholders of the

Company by way of special resolution passed at their

Extraordinary General Meeting held on April 15, 2015.

Though the said Scheme was sanctioned by the Hon’ble

High Court of Judicature at Madras on June 22, 2015

(the copy of which was received on July 23, 2015) i.e.

before the adoption of accounts by the Board of Director’s

on August 14, 2015, the effect of the said Scheme is not

given in the accounts. We are unable to determine its

impact, if any, on the standalone financial statements.

4) The Company needs to strengthen its policies, procedures

and overall controls in order to provide proper evidences

regarding recoverability of debtors, valuation of work in

progress and accounting for direct and indirect taxes

including statutory compliances.We are unable to

determine its impact, if any, on the standalone financial

statements.

Qualified Opinion

In our opinion and to the best of our information and according

to the explanations given to us, except for the possible effects

of the matters described in the Basis for Qualified Opinion

paragraph above, the aforesaid standalone financial

statements give the information required by the Act in the

manner so required and give a true and fair view in conformity

with the accounting principles generally accepted in India, of

the state of affairs of the Company as at March 31, 2015, and

its loss and its cash flows for the year ended on that date.


21

Emphasis of Matter

The Company has outstanding MAT Credit Entitlement of Rs.

134.69 Lakhs as on March 31, 2015, which in the opinion of

the management, based on the projected future taxable profits,

will be utilized within the stipulated time period prescribed

as per the provisions of Income Tax Act, 1961. Considering

the uncertainties around the assumptions used for projections

of future taxable profits and its consequential effect on

utilization of MAT Credit Entitlement, we are unable to

comment on the recoverability of MAT Credit Entitlement

outstanding as at March 31, 2015 and its consequential impact

on the Statement of Profit and Loss for the year ended March

31, 2015 and on the Reserves of the Company as on that date

(Refer Note No. 18). Our opinion is not qualified in respect of

this matter.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order, 2015

(“the Order”) issued by the Central Government of India in

terms of sub-section (11) of section 143 of the Act, we give in

the Annexure a statement on the matters specified in paragraphs

3 and 4 of the Order.

2. As required by Section 143 (3) of the Act, we report that:

(a) We have sought and obtained, except for the matters

described in the Basis for Qualified Opinion paragraph, all

the information and explanations which to the best of our

knowledge and belief were necessary for the purposes of

our audit.

(b) Except for the possible effects of the matters described in

the Basis for Qualified Opinion paragraph above, in our

opinion proper books of account as required by law have

been kept by the Company so far as it appears from our

examination of those books.

(c) The Balance Sheet, the Statement of Profit and Loss and

the Cash Flow Statement dealt with by this Report are in

agreement with the books of account.

(d) Except for the possible effects of the matters described in

the Basis for Qualified Opinion paragraph above, in our

opinion, the aforesaid standalone financial statements

comply with the Accounting Standards, except AS-2

“Valuation of Inventories”, specified under section 133 of

the Act, read with Rule 7 of the Companies (Accounts)

Rules, 2014.

(e) The matters described in the Basis for Qualified Opinion

paragraph above, in our opinion, may have an adverse

effect on the functioning of the Company.

(f) On the basis of the written representations received from

the directors as on March 31, 2015, taken on record by the

Board of Directors, none of the directors is disqualified as

on March 31, 2015, from being appointed as a director in

terms of section 164 (2) of the Act.

(g) The qualification relating to the maintenance of accounts

and other matters connected therewith are as stated in the

Basis for Qualified Opinion paragraph above.

(h) With respect to the other matters to be included in the

Auditor’s Report in accordance with Rule 11 of the

Companies (Audit and Auditors) Rules, 2014, in our opinion

and to the best of our information and according to the

explanations given to us:

i. The Company has disclosed the impact of pending

litigations on its financial position in its financial

statements as referred to in Note No. 27 to the financial

statements.

ii. The Company did not have any long-term contracts

including derivative contracts for which there were

any material foreseeable losses.

iii. There were no amounts which were required to be

transferred to the Investor Education and Protection

Fund by the Company.

For Haresh Upendra & Co.


Firm Reg. No.: 103513W

Haresh B. Shah

Partner

Pune, August 14, 2015 Membership No.: 32208


22

(i) a. The Company has maintained proper records showing

full particulars, including quantitative details and

situation of fixed assets.

b. Part of the fixed assets have been physically verified

by the management during the year in line with regular

programme of verification which, in our opinion, is

reasonable having regard to the size of the Company

and the nature of its assets. According to the

information and explanations given to us, no material

discrepancies were noticed on such verification as

compared to the book records.

(ii) a. As explained to us, inventories have been physically

verified during the year by the management. In our

opinion, the frequency of such verification is

reasonable.

b. The procedures of physical verification of inventories

followed by the management are generally reasonable

and adequate in relation to the size of the Company

and the nature of its business.

c. The Company has maintained proper records of

inventory except in the case of Work in Progress. No

material discrepancies were noticed on verification

between the physical stocks and the book records. In

our opinion, the present operative modules of ERP

are insufficient to ascertain the cost and arrive at

proper valuation of Work in Progress as per the

Accounting Policies and Accounting Standards

specified under Section 133 of the Act, read with Rule

7 of the Companies (Accounts) Rules, 2014.

(iii) During the year under audit, the Company has granted

fresh unsecured loans by way of Inter Corporate Deposit

to five companies covered in the register maintained under

section 189 of the Companies Act, 2013. The aggregate

maximum amount outstanding during the year was

Rs. 2022.25 Lakhs and the aggregate year-end balance of

such loans amounted to Rs. 1978.64 Lakhs.

a. There are no stipulations for the repayment of

principal and the interest thereon. Therefore, we are

unable to comment on the regularity of receipt of the

principal amount and interest thereon.

b. No principal or interest can be termed as overdue in

the absence of time of repayment and thus we are

unable to comment on the steps taken for recovery of

principal and interest thereon.

(iv) In our opinion and according to the information and

explanations given to us, internal control system is

inadequate considering the size of the Company and the

nature of its business with regard to purchase of inventories

and for the sale of goods and services. Further, there is a

continuing failure to correct major weakness in internal

Annexure to the Independent Auditors’ Report

(Referred to in paragraph 1 under ‘Report on other Legal and Regulatory Requirements’ Section of our report of even date)

control systems in the areas of debtors, valuation of work

in progress and accounting for direct and indirect taxes

including statutory compliances (Refer paragraph 4 of Basis

for Qualified Opinion above).

(v) As per the explanations given to us, the Company has not

accepted any deposits from the public in accordance with

the provisions of Sections 73 to 76 of the Act and the rules

framed thereunder. Accordingly, the provisions stated in

paragraph 3 (v) of the Order is not applicable to the

Company.

(vi) The cost accounts and records were not made available to

us. Hence, we are unable to comment on the maintenance

of cost records as specified by the Central Government

under Section 148(1) of the Companies Act, 2013.

(vii) a) According to the information and explanations given

to us and on the basis of our examination of the records

of the Company, the Company is irregular in

depositing undisputed statutory dues applicable to it

with the appropriate authorities during the year.

Tax Deducted at Source (TDS) amounting to Rs.21.94

Lakhs and Service Tax amounting to Rs.42.31 Lakhs

are in arrears as at March 31, 2015 for a period of

more than six months from the date they became

payable.

b) According to the information and explanations given

to us, dues that have not been deposited by the

Company on account of disputes are :

Name of Nature of Period to Amount Amount Forum where

the Statute Dues which it under paid the dispute is

relates dispute under pending

(Rs. in protest

Lakhs) (Rs. in

Lakhs)

Customs Act, Customs F.Y. 2007-08 622.67 - CESTAT

1962 Duty

Finance Act, Service F.Y. 2005-06 317 10 CESTAT

1994 Tax to

F.Y. 2009-10

Central Excise Excise F.Y. 2012-2013 23.73 - CESTAT

Act, 1944 Duty

Central Excise Excise F.Y. 2013-14 57.50 - Adjudicating

Act, 1944 Duty to Authority

F.Y. 2014-15


Act, 1944 Duty to

F.Y. 2011-12

Finance Act, Service F.Y. 2008-09 124.37 - CESTAT

1994 Tax to

F.Y. 2012-13

Sales Tax Sales Tax F.Y. 2007-08 55.00 - Adjudicating

to Authority

F.Y. 2009-10

c) There are no amounts required to be transferred to the

Investor Education and Protection Fund in accordance


23

with the relevant provisions of the Companies Act,

1956 (1 of 1956) and rules made thereunder.

(viii) The Company does not have any accumulated losses at

the end of the financial year. The Company has incurred

cash losses during the financial year. However it had not

incurred any cash losses in the immediately preceding

financial year.

(ix) In our opinion and according to the information and

explanations given to us, the Company has not defaulted

during the year in repayment of dues to financial

institutions or banks. The Company did not have any

outstanding debentures during the year.

(x) In our opinion and according to the information and

explanations given to us, the terms and conditions of the

guarantee given by the Company for loan taken by its

subsidiary from bank is not, prima facie prejudicial to the

interest of the Company. (Refer Note No. 27B on guarantee

given to bank on behalf of subsidiary).

Annexure to the Independent Auditors’ Report (Contd.)

(xi) In our opinion and according to the information and

explanations given to us, the Company has raised Term

Loan of Rs. 800 Lakhs during the period under audit. Also,

the Term Loan availed during the year has, on an overall

basis, been applied for the purposes for which the said

loans were obtained.

(xii) According to the information and explanations given to us,

no material fraud on or by the Company has been noticed

or reported during the course of our audit.




Haresh B. Shah

Partner



24

Balance Sheet as at March 31, 2015 (Rs. in Lakhs)

Particulars Note As at As at

No. March 31, 2015 March 31, 2014

EQUITY AND LIABILITIES

Shareholders’ Funds

Share Capital 2 1246.54 1246.54

Reserves and Surplus 3 8815.25 9615.16

10061.79 10861.70

Non-Current Liabilities

Long-Term Borrowings 4 2902.05 2542.65

Deferred Tax Liabilities (Net) 5 - 564.38

Other Long-Term Liabilities 6 849.03 848.03

Long-Term Provisions 7 136.44 103.01

3887.52 4058.06

Current Liabilities

Short-Term Borrowings 8 880.41 2355.06

Trade Payables 9 635.47 526.42

Other Current Liabilities 10 1227.21 1015.54

Short-Term Provisions 11 179.33 141.31

2922.42 4038.34

Total 16871.72 18958.10

ASSETS

Non-Current Assets

Fixed Assets 12

Tangible Assets 11961.20 11763.87

Capital Work-In-Progress - 476.18

11961.20 12240.06

Non-Current Investments 13 572.50 563.25

Long-Term Loans and Advances 14 646.00 645.50

Current Assets

Inventories 15 486.99 423.50

Trade Receivables 16 713.65 1256.52

Cash and Bank Balances 17 313.61 976.04

Short-Term Loans and Advances 18 2177.76 2853.24

3692.02 5509.30

Total 16871.72 18958.10

Significant Accounting Policies 1

Notes are an Integral part of the Financial Statements 2 - 45

As per our report of even date For and on behalf of the Board of Directors

For Haresh Upendra & Co. Salil Taneja B. R. Taneja

Chartered Accountants Chairman Director

Firm Reg. No.: 103513W DIN : 00328668 DIN : 00328615

Haresh B. Shah Ajay Gupta Chetan Nathani

Partner Chief Financial Officer Company Secretary

Membership No. 32208

Pune, August 14, 2015 Pune, August 14, 2015


25

Statement of Profit and Loss for the year ended March 31, 2015 (Rs. in Lakhs)

Particulars Note Year ended Year ended

No. March 31, 2015 March 31, 2014

INCOME

Revenue from Operations (Net) 19 2814.98 5348.36

Revenue from Trading Activities 20 353.27 -

Other Income 21 358.75 123.69

Total Revenue 3527.00 5472.05

EXPENSES

Cost of Materials Consumed 22 550.97 1537.53

Purchase of Trading Goods 346.34 -

Changes in Inventory of Work-In-Progress 23 (7.00) 47.51

Operational and Other Expenses 24 1814.65 1307.46

Employee Benefits Expense 25 1081.05 1813.48

Finance Costs 26 694.44 543.27

Depreciation & Amortisation Expense 12 345.93 352.43

Total Expenses 4826.38 5601.68

Loss before Extraordinary Items and Tax (1299.39) (129.63)

Less: Prior Period Items 8.95 2.46

Less: Permanent Diminution in Investment in Associate 13 0.75 -

Loss before Tax (1309.08) (132.10)

Tax Expense:

Current Tax - -

FBT for Earlier Year 0.42 -

Short Tax Provision for Earlier Years 7.89 -

Total Tax (Benefit)/ Expense 8.31 -

Deferred Tax Liability Written Back 5 (564.38) -

Loss for the Year (753.02) (132.10)

Profit/(Loss) from continuing operations before tax (963.18) (351.22)

Tax Expense (556.07) -

Profit/(Loss) from continuing operations after tax (407.11) (351.22)

Profit/(Loss) from discontinuing operations before tax 36 (345.90) 219.13

Tax Expense 36 - -

Profit/(Loss) from discontinuing operations after tax (345.90) 219.13

Earnings per equity share (In Rs.) - Basic and Diluted 28 (3.02) (0.53)

(Face value of Rs. 5/- each)


Notes are an Integral part of the Financial Statements 2 - 45










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Cash Flow Statement for the year ended March 31, 2015(Rs. in Lakhs)

Particulars Year ended Year ended

March 31, 2015 March 31, 2014

A CASH FLOW FROM OPERATING ACTIVITIES

Loss before extraordinary items and tax (1299.39) (129.63)

Adjustments for :

Depreciation & Amortisation Expense 345.93 352.43

Prior Period Items (8.95) (2.46)

Finance Costs 694.44 543.27

Interest Income (256.11) (101.92)

Operating Profit before Working Capital Changes (524.06) 661.69

Adjustments for :

Trade and Other Receivables 742.44 (462.57) #

Inventories (63.49) 153.14

Trade and Other Payables (142.87) 385.08 #

Cash Generated from Operations 12.01 737.34

Direct Taxes Paid (Net of Refunds) 178.87 (59.82)

Net Cash Flow from Operating Activities 190.88 677.52

B CASH FLOW FROM INVESTING ACTIVITIES

Purchase of Fixed Assets including Capital Work-in-Progress (114.49) (608.76) #

and Capital Advance

Investment in Equity of Subsidiary Companies (10.00) (75.00)

ICD to Subsidiary Company (Net) 288.72 (690.16)

Interest Income on ICD given to Subsidiary Company 97.68 62.91

Net Cash Flow from/ (used in) Investing Activities 261.92 (1311.01)

C CASH FLOW FROM FINANCING ACTIVITIES

Additions/ (Repayments) of Loans (1158.74) 1484.24

Interest Income 158.42 39.01

Finance Costs (679.30) (543.27)

Net Cash Flow (used in)/ from Financing Activities (1679.62) 979.98

Total Cash (Outflow)/ Inflow for the year (1226.81) 346.49

Deferred Tax Liability Written Back (Refer Note No. 5) 564.38 -

Net Increase/ (Decrease) in Cash and Cash Equivalents (662.43) 346.49

Cash and Cash Equivalents at the beginning of the year 976.04 629.55

Cash and Cash Equivalents at the end of the year 313.61 976.04


# These cash flows are arrived at after giving effect to the transaction of Hive Off of Engineering Design Services

Division of the Company to its Subsidiary ‘TAAL Tech India Private Limited’ (Refer Note No. 39).

Notes:

1 The above Cash Flow Statement has been prepared under the “Indirect Method” set out in Accounting Standard (AS) - 3 on Cash

Flow Statement issued by the ICAI.

2 Figures in bracket indicate Cash Outflow.

3 Cash and Cash Equivalents are Cash and Bank Balances as mentioned in Note No. 17.










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Notes to Financial Statements for the year ended March 31, 2015

Company Background

Taneja Aerospace and Aviation Limited (TAAL) is a public limited company incorporated in India under the Companies Act, 1956.

TAAL is engaged in the business of manufacture and sale of various parts and components to aviation industry, providing services related

to Aircraft Charter, Airfield & MRO and Allied Services.

NOTE 1: SIGNIFICANT ACCOUNTING POLICIES

1.1 Basis of Accounting

The financial statements have been prepared in compliance with the requirements under Section 133 of the Companies Act, 2013

(to the extent notified), read with Rule 7 of the Companies (Accounts) Rules, 2014, and other generally accepted accounting

principles (GAAP) in India, to the extent applicable, on the accrual basis of accounting, under the historical cost convention, except

for certain fixed assets which are being carried at revalued amounts. GAAP comprises mandatory accounting standards as specified

in the Companies (Accounting Standards) Rules, 2006.

Accounting policies not stated explicitly otherwise are consistent with generally accepted accounting principles in India.

1.2 Use of Estimates

The preparation of financial statements in conformity with Generally Accepted Accounting Principles (GAAP) in India requires

management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of

contingent liabilities on the date of financial statements and the reported amount of revenue and expenses during the reporting

period. The management believes that the estimates used in preparation of the financial statements are prudent and reasonable.

Actual results could defer from these estimates. Difference between the actual results and estimates are recognised in the period in

which the results are known / materialised.

1.3 Classification of Assets and Liabilities

Schedule III to the Companies Act, 2013 requires assets and liabilities to be classified as either Current or Non-current.

a) An asset is classified as current when it satisfies any of the following criteria:

(i) it is expected to be realised in, or is intended for sale or consumption in, the Company’s normal operating cycle;

(ii) it is held primarily for the purpose of being traded;

(iii) it is expected to be realized within twelve months after the reporting date; or

(iv) it is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least twelve

months after the reporting date.

b) All assets other than current assets are classified as non-current.

c) A liability is classified as current when it satisfies any of the following criteria:

(i) it is expected to be settled in the Company’s normal operating cycle;


(iii) it is due to be settled within twelve months after the reporting date; or

(iv) the Company does not have an unconditional right to defer settlement of the liability for at least twelve months after

the reporting date. Terms of a liability that could, at the option of the counter party, result in its settlement by the

issue of equity instruments do not affect its classification.

d) All liabilities other than current liabilities are classified as non-current.

1.4 Operating Cycle

An operating cycle is the time between the acquisition of assets or inventories for processing and their realisation in cash or cash

equivalents. Based on the nature of its products / services, the Company has ascertained its operating cycle as twelve months for

the purpose of current or non-current classification of assets and liabilities.

1.5 Fixed Assets

a) Fixed assets are stated at their original cost of acquisition or construction except in case of certain assets which have been

revalued, at its revalued amount, less accumulated depreciation and impairment loss, if any. The cost of fixed assets

comprises of its purchase price including duties, taxes, freight and any other directly attributable cost of bringing the asset

to its working condition for its intended use. However, cost excludes Excise Duty, VAT & Service Tax, wherever credit of the

duty or tax is availed of.


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b) All indirect expenses incurred on project implementation including interest cost on funds deployed for the project are treated

as incidental expenditure during construction and are capitalised for the period until the asset is ready for its intended use.

c) Fixed assets under construction and not ready for intended use, as on the balance sheet date, are disclosed as Capital Work-

in-Progress.

d) Considering the nature of business activity, Runway has been treated as Plant and Equipment and depreciation has been

provided accordingly.

e) Assets received on amalgamation are recorded at its fair value.

1.6 Depreciation

Depreciation is provided on Straight Line Method for Building, Plant and Equipment and Computer-Hardware and on Written

Down Value Method on all other assets, based on useful life prescribed in Part C of Schedule II of the Companies Act, 2013. Based

on the technical evaluation which considered the nature and usage of the assets, the operating conditions of the assets, anticipated

technological changes and maintenance support etc., useful life of the following asset class is estimated to be higher than that

prescribed in the said Act:

Sr. No. Asset Class Useful life estimated by the Management

1. Plant and Equipment 15 - 48 Years

1.7 Impairment of Assets

At each Balance Sheet date, the Company ascertains whether there is any impairment of the fixed assets based on internal / external

factors. Where there is an indication that an asset is impaired, the recoverable amount if any, is estimated and the impairment loss

is recognised to the extent carrying amount of an asset exceeds its recoverable amount. Further, if at the Balance Sheet date there

is an indication that the previously assessed impairment loss no longer exist, the recoverable amount is reassessed and the asset is

reflected at recoverable amount subject to maximum of depreciable historical cost.

1.8 Inventories

a) Stock of raw materials, stores, spares, bought out items and certain components are valued at cost less amounts written

down.

b) Stock of certain aero structures, components, work in progress and finished goods are valued at lower of cost and net

realisable value based on technical estimate of percentage of work completed.

c) In determining the cost of raw materials, components, stores, spares and loose tools, the first in first out (FIFO) method is

used. Cost of inventory comprises all costs of purchase, duties, taxes (other than those subsequently recoverable from tax

authorities) and all other costs incurred in bringing the inventory to their present location and condition.

d) Cost of certain aero structures, work in progress and finished goods include material cost, labour costs and appropriate

factory overheads.

1.9 Investments

a) Investments that are readily realisable and intended to be held for not more than a year from the date of acquisition are

classified as current investments. All other investments are classified as non-current investments.

b) Current investments are stated at lower of cost and fair value determined on an individual investment basis.

c) Non-current investments are stated at cost. A provision for diminution in the value of non-current investments is made only

if such a decline is other than temporary in the opinion of the management. The determination for diminution is done

separately for each individual investment.

1.10 Trade Receivables

Trade receivables are stated after writing off debts considered as bad. Adequate provision is made for debts considered doubtful.

Bad Debts previously written off and recovered during the year is credited to the Statement of Profit and Loss.

1.11 Provisions, Contingent Liabilities and Contingent Assets

a) A provision is recognised when an enterprise has a present obligation as a result of past event and it is probable that an

outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions

are not discounted to their present values and are determined based on management estimate required to settle the obligation

at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current management

estimates.

Notes to Financial Statements for the year ended March 31, 2015 (Contd.)


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b) Contingent liabilities are disclosed in respect of possible obligations that have arisen from past events and the existence of

which will be confirmed only by the occurance or non-occurance of future events not wholly within the control of the

Company.

c) When there is an obligation in respect of which the likelyhood of outflow of resources is remote, no provision or disclosure

is made.

d) Contingent Assets are neither recognised nor disclosed in the financial statements.

1.12 Revenue Recognition

a) Revenue from long-term fixed price contracts to manufacture aero structures, spares, etc. is recognised under proportionate

completion method and the stage of completion for this purpose is determined based on technical estimate of actual work

completed.

b) Rental Income from Hanger Utilisation is accounted based on agreement / contract entered into with the third party.

c) Charter Income from aircraft given on charter is booked on the basis of contracts with customers and actual flying hours of

the aircraft.

d) Training Fees received, being non-refundable, is accounted in the year of receipt.

e) Revenue from Engineering Design Services is priced on time and material basis and is recognised when the services are

rendered and related costs are incurred.

f) Revenue from long term fixed price contracts for supply of certain sets of components and assemblies is recognised on the

basis of proportionate completion method and billed in terms of agreement with and certification by the customer. Cost of

processing incurred on sets of components which are not billable is included in work in progress.

g) Revenue from sale of goods is recognised on transfer of all significant risks and rewards of ownership to the buyer. The

amounts recognised as sale is exclusive of Sales Tax / VAT and are net of returns.

h) Interest Income is recognised on time proportion basis taking into account the amount outstanding and the interest rate

applicable.

1.13 Leases

Operating Lease payments are recognised as an expense in the Statement of Profit and Loss on a straight-line basis over the lease

term.

1.14 Borrowing Cost

Borrowing Costs directly attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of

the assets, upto the date the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the

Statement of Profit and Loss in the year in which they are incurred.

1.15 Foreign Currency Transactions

a) Initial Recognition: Transactions denominated in foreign currencies are recorded at the exchange rates prevailing on the date

of the transaction.

b) Conversion: At the year end, monetary items denominated in foreign currencies are converted into rupee equivalents at the

year-end exchange rates.

c) Exchange Differences: All exchange differences arising on settlement / conversion of foreign currency transactions are

recognised as income or expense in the Statement of Profit and Loss in the year in which they arise.

d) Non monetary foreign currency items such as investments are carried at cost.

1.16 Employee Benefits

a) Defined Contribution Plan

The Company makes defined contribution to Provident Fund and Superannuation Fund, which are recognised as an expense

in the Statement of Profit and Loss on accrual basis.

b) Defined Benefit Plan

The Company’s liabilities under Payment of Gratuity Act and Long Term Compensated Absences are determined on the

basis of actuarial valuation made at the end of each financial year using the Projected Unit Credit Method, except for short

term compensated absences, which are provided on actual basis. Actuarial gains and losses are recognised immediately in the



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Statement of Profit and Loss as income or expense. Obligations are measured at the present value of estimated future cash

flows using a discounted rate that is determined by reference to market yields at the Balance Sheet date on Government

Bonds where the currency and terms of the Government Bonds are consistent with the currency and estimated terms of the

defined benefit obligation.

1.17 Provision for Taxation

Tax expense for the period, comprising Current Tax and Deferred Tax are included in the determination of the net profit or loss for

the year.

Current Tax is the amount of tax payable on the taxable income for the year as determined in accordance with the provisions of the

Income Tax Act, 1961.

Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives future economic benefits in the form of

adjustment to future income tax liability, is considered as an asset. Accordingly, MAT is recognised as an asset in the Balance Sheet

when it is probable that future economic benefit associated with it will flow to the Company.

Deferred tax is recognised on timing differences, being the difference between the taxable income and the accounting income that

originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates

and the tax laws that have been enacted or substantively enacted as at the Balance Sheet date. Deferred tax assets in respect of

unabsorbed depreciation and carry forward of losses are recognised if there is virtual certainty that there will be sufficient future

taxable income available to realise such assets. Other deferred tax assets are recognised only to the extent there is a reasonable

certainty that the asset will be realised in future.

1.18 Segment Reporting

Segments are identified having regard to the dominant source and nature of risks and returns and internal organization and

management structure. The Company has considered business segments as the primary segments for disclosure. The business

segments are ‘Aviation’, ‘Charter Business’ and ‘Trading of Electrical Goods’. The Company does not have any geographical

segment.

1.19 Contingencies and Events Occurring after the Date of Balance Sheet

a) Accounting for contingencies arising out of contractual obligation, are made only on the basis of mutual acceptances.

b) Material events occurring after the date of Balance Sheet up to the date of adoption of the accounts are considered in

preparation and presentation of the financial statements.

1.20 Earnings Per Share

The Basic and Diluted Earnings Per Share (“EPS”) is computed by dividing the net profit or loss after tax for the year attributable

to equity shareholders by weighted average number of equity shares outstanding during the year.



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2. SHARE CAPITAL (Rs. in Lakhs)

Particulars As at As at

March 31, 2015 March 31, 2014

Authorised Capital

4,00,00,000 (Previous Year 4,00,00,000) 2,000.00 2,000.00

Equity Shares of Rs. 5/- each

10,00,000 (Previous Year 10,00,000) 500.00 500.00

15% Redeemable Cumulative Preference Shares of Rs. 50/- each

2,500.00 2,500.00

Issued, Subscribed and Paid Up Capital

2,49,30,736 (Previous Year 2,49,30,736) 1,246.54 1,246.54

Equity Shares of Rs. 5/- each fully paid

2.1 Reconciliation of the number of shares outstanding at the beginning and at the end of the year :


March 31, 2015 March 31, 2014

No. of Rs. No. of Rs.

shares in Lakhs shares in Lakhs

Equity Shares at the beginning of the year 2,49,30,736 1246.54 2,49,30,736 1246.54

Equity Shares issued during the year - - - -

Equity Shares bought back during the year - - - -

Equity Shares outstanding at the end of the year 2,49,30,736 1246.54 2,49,30,736 1246.54

2.2 Details of shareholders holding more than 5% Equity Shares in the Company

Name of the Shareholders As at As at

March 31, 2015 March 31, 2014

No. of % No. of %

shares holding shares holding

Indian Seamless Enterprises Limited 1,09,64,620 43.98 1,09,64,620 43.98

Vishkul Leather Garments Private Limited 16,89,179 6.78 16,89,179 6.78

2.3 Terms/rights attached to Equity Shares

The company has only one class of equity Share having par value of Rs. 5/- each. Each shareholder is entitled to one vote per share.

In the event of liquidation of the Company, the holders of Equity Shares will be entitled to receive any of the remaining assets of

the Company, after distribution of all preferential amounts, in proportion to their shareholding.

2.4 As at 31st March, 2015, the Company has 15,000 Global Depository Receipts (GDR’s) outstanding for conversion into Equity

shares (equivalent to 30,000 Equity Shares).


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3. RESERVES AND SURPLUS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Capital Reserve

Balance as at the beginning and as at the end of the year 5.83 5.83

Securities Premium Account

Balance as at the beginning and as at the end of the year 6,600.75 6,600.75

General Reserve

Balance as at the beginning and as at the end of the year 1,271.86 1,271.86

Surplus in Statement of Profit and Loss

Balance as at the beginning of the year 1,736.72 1,868.81

Less: Depreciation adjustment consequent to revision in useful 46.89 -

lives [Refer Significant Accounting Policies Note No. 1.6

and Note No. 12]

Add: Net Profit/(Loss) after tax transferred from (753.02) (132.10)

Statement of Profit and Loss

Balance as at the end of the year 936.81 1,736.72

8,815.25 9,615.16

4. LONG TERM BORROWINGS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Secured Loans:

Term Loan from Banks 3,393.78 3,077.87

Less: Current Maturities (Refer Note No. 10) 491.73 535.22

2,902.05 2,542.65

4.1 Maturity Profile of Secured Term Loans from Bank (Rs. in Lakhs)

Particulars Maturity Profile

1-2 years 2-3 years 3-4 years Beyond 4 years

Term Loans from Banks 575.82 689.62 384.01 1,252.60

4.2 Details of Securities and other terms :

The Term Loan from Bank outstanding as on 31st March, 2015 amounting to Rs. 0.15 Crore (including Current Maturities of Long

Term Borrowings) is secured by a first charge on assets created out of TL – Building Rs. 4.60 Crores and Plant and Equipment

Rs. 10.48 Crores of the Company and second charge on specific free hold lands to the extent of 26.87 acres and construction

thereon of the Company at Belagondapalli Village, Thally Road, Denkanikottai Taluk, Krishnagiri District, Belagondapalli –

635114, Tamil Nadu.

The Term Loan from Bank outstanding as on 31st March, 2015 amounting to Rs. 18.44 Crores (including Current Maturities of

Long Term Borrowings) is secured by a first charge on assignment of Hanger-1 rental/receivables from lessee and specific free hold

lands to the extent of 36.93 acres of land and development thereon of the Company at Belagondapalli Village, Thally Road,

Denkanikottai Taluk, Krishnagiri District, Belagondapalli – 635114, Tamil Nadu. Second Pari Passu Charge is created on other fixed

assets (both movable and immovable) of the Company along with other consortium banks as collateral security.

The Term Loan from Bank outstanding as on 31st March, 2015 amounting to Rs. 15.34 Crores (including Current Maturities of

Long Term Borrowings) is secured by a first charge on assignment of Hanger-2 rental/receivables from lessee and specific free hold

lands to the extent of 37.11 acres of land and development thereon of the Company at Belagondapalli Village, Thally Road,

Denkanikottai Taluk, Krishnagiri District, Belagondapalli – 635114, Tamil Nadu as collateral security.


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5. DEFERRED TAX LIABILITIES (NET) (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Deferred Tax Liability: #

Difference in net book value of fixed assets as per books and - 564.38

tax laws

Deferred Tax Asset * - -

Net Deferred Tax Liability - 564.38

# During the year, the Company has written back the deferred tax liability amounting to Rs. 564.38 Lakhs.

* Deferred tax calculation results into working of deferred tax assets as at March 31, 2015. However as a matter of prudence, the

Company has not recognised deferred tax asset.

6. OTHER LONG TERM LIABILITIES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Deposit from Lessee 845.28 845.28

Deposit from Customers 3.75 2.75

849.03 848.03

7. LONG TERM PROVISIONS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Provision for Employee Benefits (Refer Note No. 33)

Gratuity 90.67 68.55

Leave Encashment 45.77 34.46

136.44 103.01

8. SHORT TERM BORROWINGS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Secured Loans:

Working Capital Borrowing from Banks 880.41 1700.06

880.41 1700.06

Unsecured Loans:

Loans and Advances from Related Party - 655.00

(Inter Corporate Deposit) (Refer Note No. 32)

- 655.00

880.41 2355.06

8.1 Details of Securities and other terms

Working Capital Loan from Banks is secured against hypothecation of Stocks and Book Debts on pari-passu basis and second

charge on Fixed Assets.


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9. TRADE PAYABLES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Micro, Small and Medium Enterprises * - -

Other Trade Payables 635.47 526.42

635.47 526.42

* As informed to us by the Management, the Company owes no dues which are outstanding as at March 31, 2015 to any ‘Micro, Small

And Medium Enterprises’ as covered under “Micro, Small And Medium Enterprises Development Act 2006”. Dues to Micro, Small and

Medium Enterprises have been determined to the extent such parties have been identified on the basis of intimation received from the

“suppliers” regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006.

10. OTHER CURRENT LIABILITIES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Current Maturities of Long Term Borrowings (Refer Note No. 4) 491.73 535.22

Advance from Customers 318.32 65.22

Statutory Liabilites * 118.03 106.04

Employee Related Liabilties # 131.97 71.52

Expenses Payable 158.36 49.04

Other Liabilities 8.80 188.51

1227.21 1015.54

* Includes payable towards TDS, Excise Duty, Service Tax, VAT and Employee Related Statutory Obligations.

# Including Rs. 39.93 Lakhs due to Whole Time Director’s (Previous Year Rs. 1.85 Lakhs).

11. SHORT TERM PROVISIONS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Provision For Audit Fees 8.32 6.62

Provision For Taxes * 137.25 134.69

Provision For Expenses # 33.76 -

179.33 141.31

* Includes Provision for Income Tax Rs. 134.69 Lakhs (Previous Year Rs. 134.69 Lakhs).

# Includes Provisions related to Travelling Expenses, Purchases, etc.

12. FIXED ASSETS (Rs. in Lakhs)

GROSS BLOCK (AT COST) DEPRECIATION /AMORTISATION NET BLOCK

Description As at Additions Deduct As at As at For Deduct- Adjust As at As at As at

April 01, ions March 31, April 01, The ions ments* March 31, March 31, March 31,

2014 2015 2014 Year 2015 2015 2014

Tangible Assets:

Freehold Land $ 6274.80 - - 6274.80 - - - - - 6274.80 6274.80

Buildings 2351.24 38.21 - 2389.45 490.51 64.39 - - 554.90 1834.55 1860.74

Plant and Equipment 6225.44 544.29 - 6769.73 2685.72 **256.6 - 1.99 2944.31 3825.42 3539.72

Office Equipment 169.53 0.70 - 170.23 115.80 8.11 - 42.00 165.91 4.31 53.72

Furniture and Fixtures 93.70 - - 93.70 81.46 3.55 - - 85.01 8.70 12.25

Computer - Hardware 20.43 3.09 - 23.52 7.57 9.68 - 1.25 18.49 5.03 12.86

Vehicles 32.56 4.01 - 36.57 22.77 3.61 - 1.66 28.04 8.53 9.79

Total 15167.70 590.30 - 15758.00 3403.83 345.93 - 46.89 3796.79 11961.20 11763.87

Previous Year 14213.14 1296.67 # 342.11 15167.70 3130.23 352.43 # 78.83 - 3403.83 11763.87 11082.91

CAPITAL WORK-IN-PROGRESS (AT COST) As at As at

March 31, 2015 March 31, 2014

(a) Building - 337.60

(b) Plant and Equipment - 138.58

Total - 476.18

* As per Schedule II of the Companies Act, 2013 written down value of Fixed Assets whose lives have expired as at April 01, 2014 amounting to Rs. 46.89 Lakhs

have been adjusted against opening balance in Statement of Profit and Loss. (Refer Note No. 3)


35


13. NON CURRENT INVESTMENTS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Unquoted, at cost fully paid up

Investment in Equity Shares

A. Subsidiary Companies

(i) First Airways Inc,USA # 477.50 477.50

11,50,000 Shares (Previous Year 11,50,000) of

USD 1/- each

(ii) TAAL Tech India Private Limited * 85.00 85.00

8,50,000 Shares (Previous Year 8,50,000) of

Rs. 10/- each

(iii) Katra Auto Engineering Private Limited 5.00 -

50,000 Shares (Previous Year Nil) of Rs. 10/- each

(iv) TAAL Enterprises Limited 5.00 -

50,000 Shares (Previous Year Nil) of Rs. 10/- each

572.50 562.50

B. Associate Company

(i) TAAL Aerosystems Private Limited ** 0.75 0.75

7,500 Shares (Previous Year 7,500) of Rs. 10/- each

Less: Provision for Permanent Diminution 0.75 -

- 0.75

572.50 563.25

# As perceived by Management, investment in First Airways Inc.,USA does not require any provision for diminution in value of

investment.

* Consequent to private placement of shares to the Whole Time Director of TAAL Tech India Private Limited as on October 16

2014, the Company ceases to be a Wholly Owned Subsidiary of Taneja Aerospace and Aviation Limited effective same date.

** TAAL Aerosystems Private Limited has applied for Dissolution on March 30, 2015. Hence, the same has been written off.

14. LONG TERM LOANS AND ADVANCES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Unsecured and Considered Good

Capital Advance to Subsidiary (Refer Note No’s. 32 & 37) 646.00 645.50

646.00 645.50

# Represents deduction on account of Hive Off of Engineering Design Services Division of the Company to its Subsidiary ‘TAAL Tech India Private Limited’. (Refer

Note No. 39)

$ The Gross Block of Freehold Land includes Rs. 4738.89 Lakhs (Previous Year Rs. 4738.89 Lakhs) on account of Revaluation.

** Had the Company continued with the previously assessed useful lives in respect of Plant and Equipment, charges for depreciation for the year would have been

higher by Rs. 64.54 Lakhs for assets held at April 01, 2014.

Pursuant to the enactment of the Companies Act, 2013, the Company has applied the estimated useful lives as specified in Schedule II, except in respect of certain

assets as disclosed in Significant Accounting Policy on Depreciation. [Refer Note No. 1.6]

The Company has capitalised the following expenses during the year to New Project, in accordance with the accounting policy consistently followed :

(Rs. In Lakhs)


March 31, 2015 March 31, 2014

a. Personnel Expenses

i) Managing Director’s Salary - 17.03

ii) Other Salary 1.85 24.03

b. Travelling Expenses 0.69 1.73

c. Interest - 55.16

d. Other Expenses 4.98 5.90

7.53 103.86


36

15. INVENTORIES (As taken, valued and certified by the Management) (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Raw Material and Components 183.24 126.75

Work-In-Progress 303.75 296.75

486.99 423.50

For mode of valuation of each class of inventories, Refer Note No.1.8

16. TRADE RECEIVABLES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Unsecured debts outstanding for a period exceeding six months

(i) Considered good 281.51 426.07

(ii) Considered doubtful 198.09 2.98

479.60 429.05

Less: Provision for doubtful debts 198.09 2.98

281.51 426.07

Other unsecured debts (considered good) 432.14 830.45

713.65 1256.52

17. CASH AND BANK BALANCES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Cash and cash equivalents

Balance with banks in current accounts 134.25 283.46

Balance with banks in deposits (Less than 3 months maturity) 7.07 500.86

Cash on hand 0.05 1.94

Other bank balances

Margin money deposits with banks 172.25 189.78

(More than 3 months maturity)

313.61 976.04

18. SHORT TERM LOANS AND ADVANCES (Rs. in Lakhs)


March 31, 2015 March 31, 2014


Inter Corporate Deposits - 1103.41

MAT Credit Entitlement # 134.69 134.69

Advance Income Tax 551.63 738.81

Loans and Advances to Related Parties (Refer Note No. 32) 1332.64 724.52

Advance to Suppliers 58.43 75.81

Prepaid Expenses 33.73 36.34

Sundry Deposits 46.42 27.39

Advance to Employees 20.23 12.25

2177.76 2853.24

# In the opinion of the management, based on the projected future taxable profits, the outstanding MAT Credit Entitlement of Rs.

134.69 Lakhs as at March 31, 2015 will be utilized within the stipulated time period prescribed as per the provisions of Income

Tax Act, 1961. However, in case of inadequate profit, difference will be charged to respective years Statement of Profit and Loss.



37


19. REVENUE FROM OPERATIONS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Sales – Aviation

Gross Domestic Sales 540.35 832.47

Less: Excise Duty 26.36 31.45

Net Domestic Sales 513.99 801.02

Export Sales 5.95 484.14

Services – Aviation

Domestic Conversion Charges 480.83 798.18

Export Conversion Charges 7.63 534.11

Charter Income * 717.16 794.47

Rental Services 1022.83 692.45

Training & Other Services 66.60 91.77

Engineering Design Services (Refer Note Nos. 39 & 44)

Export Services - 1137.81

Domestic Services - 14.41

2814.98 5348.36

* This does not include use of Aircraft for Testing & Training purposes and use by Management for Business Travel.

20 REVENUE FROM TRADING ACTIVITIES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Sale of Trading Goods (Refer Note No. 38) 346.34 -

Sale Commission on Trading Goods 6.93 -

353.27 -

21 OTHER INCOME (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Interest Income

From ICD’s 190.19 75.73

From Banks 16.54 24.98

From Others * 49.37 1.21

Miscellaneous Income # 18.42 14.81

Sundry Creditors Written Back 84.22 6.96

358.75 123.69

* Includes Interest on Income Tax Refunds of Rs. 47.66 Lakhs (Previous Year Rs. Nil).

# Includes Agriculture Income of Rs 12.41 Lakhs (Previous Year Rs. 12.35 Lakhs).

22 COST OF MATERIALS CONSUMED (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Opening Stock of Raw Material and Components 126.75 232.39

Add: Purchases during the year 607.46 1431.89

Less: Closing Stock of Raw Material and Components 183.24 126.75

Consumption of Raw Material and Components 550.97 1537.53


38


22.1 Value of Raw Materials and Components consumed during the Year

Particulars Percentage (%) Value (Rs. in Lakhs)

Year ended Year ended Year ended Year ended

March 31, 2015 March 31, 2014 March 31, 2015 March 31, 2014

Imported * 19.04 37.14 104.92 571.11

Indigenous 80.96 62.86 446.05 966.42

100 100 550.97 1537.53

* The imported raw material and components are presumed to be consumed during the year of purchase.

22.2 CIF Value of Imports of Raw Material, Spares, etc. for the year (Rs. in Lakhs) 104.92 571.11

23 CHANGES IN INVENTORIES OF WORK-IN-PROGRESS

(Rs. in Lakhs)


March 31, 2015 March 31, 2014

Closing Stock of Work-In-Progress 303.75 296.75

303.75 296.75

Opening Stock of Work-In-Progress 296.75 344.25

296.75 344.25

(Increase) / Decrease in Inventory (7.00) 47.51

24 OPERATIONAL AND OTHER EXPENSES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Charter Expenses

Aircraft Fuel Charges 139.30 152.50

Aircraft Lease Rent ^ 399.71 344.14

Aircraft Repairs and Maintenance 240.02 50.93

Rent - Flight Parking & Equipment 23.16 15.84

Other Aircraft Operating Expenses 95.13 75.85

Power & Fuel Expenses 104.90 99.49

Repairs and Maintenance Plant and Equipment 31.87 15.55

Repairs and Maintenance Building 1.49 4.01

Repairs and Maintenance Others 9.65 61.77

Selling Expenses 65.91 85.54

Rent 42.70 32.82

Educational Program Expenses 1.81 1.93

Rates & Taxes 65.64 36.11

Insurance 20.85 26.02

Traveling & Conveyance 142.32 174.73

Communication Expenses 17.02 22.32

Provision for Doubtful Debts 195.11 -

Directors’ Sitting Fees 6.90 3.90

Office & Other Administrative Expenses * 59.45 100.78

Legal, Professional & Consultancy Charges 140.38 74.65

Exchange Fluctuation Loss / (Gain) [Net] 5.23 (76.96)

(Other than considered as Finance Cost)

Auditors Remuneration # 6.11 5.54

1,814.65 1,307.46


39


^ Aircraft Lease Rent

During the year 2007-08, Company acquired an Aircraft on operating lease from an overseas lease finance company for a period

of 120 months.

The payments under lease for the future period are:

Particulars Amount in Equivalent in

US $ Rs. In Lakhs

Less than One Year 4.85 303.55

More than 1 Year and less than 5 Years 8.92 558.22

13.77 861.77

Note : In addition to the future fixed lease rentals mentioned above, variable component linked to LIBOR plus 2.50% p.a. is also payable

on monthly basis.

* Includes Printing & Stationery Expenses, Security Charges, Agriculture Expenses & Miscellaneous Expenses.

(Rs. in Lakhs)

# Auditors Remuneration : Year ended Year ended

March 31, 2015 March 31, 2014

Audit Fees 3.25 3.00

Tax Audit Fees 1.00 1.00

Fees for Other Services 1.50 1.05

Out of Pocket Expenses/Travelling 0.36 0.23

Cost Audit Fees - 0.25

6.11 5.53

25 EMPLOYEE BENEFITS EXPENSE (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Salaries and Wages 930.46 1679.80

Contribution to Provident and Other Funds (Refer Note No. 33) 75.99 49.70

Staff Welfare Expenses 74.60 83.97

1081.05 1813.48

26 FINANCE COSTS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Interest Expenses:

Working Capital Loan 159.20 169.17

Term Loans 387.36 233.97

Inter Corporate Deposits (Refer Note No. 32) 46.38 115.21

592.94 518.34

Less: Capitalised during the Year - 55.16

592.94 463.18

Other Finance Costs # 101.50 80.09

694.44 543.27

# Includes Interest on Delayed Payment of Statutory Liabilities amounting to Rs. 34.86 Lakhs (Previous Year Rs. 1.55 Lakhs).


40


27 A) Contingent Liabilities (to the extent not provided for) : (Rs. in Lakhs)


March 31, 2015 March 31, 2014

(a) Claims against the Company not acknowledged as debts:

(i) Custom Duty 622.67 622.67

(ii) Service Tax 441.37 441.37

(iii) Excise Duty 161.47 103.97

(iv) Sales Tax 55.00 78.00

Future Cash Outflows in respect of the above, if any, is determined only on receipt of judgement/decisions pending with relevant

authorities. The Company does not expect the outcome of matters stated above to have a material adverse effect on the Company’s

financial condition, result of operations or cash flows.

(b) In addition, the Company is subject to other legal proceedings in respect of other matters arisen in the ordinary course of business.

The Company’s management is of the opinion that the ultimate liability in respect of these litigations shall not have any material

adverse effect on the Company’s operation and financial position.

B) Capital and Other Commitments (to the extent not provided for) : (Rs. in Lakhs)


March 31, 2015 March 31, 2014

(a) Capital Commitment towards the new project - 83.00

(b) Letters of Credit 291.61 -

(c) Bank Guarantees 1,198.71 1,097.56

(d) Indemnity issued to Customers 229.80 918.80

(e) EPCG Export sales obligation to be fulfilled 681.70 660.70

(f) Guarantee given to bank on behalf of Subsidiary 760.00 -

28 Earnings Per Equity Share: (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Loss after tax available for Equity Shareholders (753.02) (132.10)

Weighted Average number of Equity Shares of nominal value of 2,49,30,376 2,49,30,376

Rs. 5 each

Computation of EPS - Basic* (in Rs.) (3.02) (0.53)

*Diluted EPS is same as Basic EPS, as there are no outstanding potential Equity Shares as on date.

29 Earnings in Foreign Currency (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Export of Goods 5.95 484.14

Export of Services 7.63 1,671.92

Other Receipts 2.34 -

15.92 2,156.06


41


30 Expenditure in Foreign Currency (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Parts and Components 117.60 615.34

Travelling Expenses 3.31 171.11

Aircraft Repairs and Maintenance 237.70 -

Work Permit Fees - 19.38

Aircraft Lease Rent 399.71 307.98

Onsite Expenses - 367.05

Subscription Fees 9.37 8.20

Labour Charges - 139.06

Sales Commission - 9.15

Other 13.51 0.08

781.19 1637.35

31 Disclosure as required by Clause 32 of the Listing Agreement

a) Amount of Investment in / Loans and Advances in the nature of loans to subsidiaries and associates for the year ended 31st March

2015 :

(Rs. in Lakhs)

Name of the Company Holding Nature of Max. Balance Balance Balance

Transaction during the as at as at

Period March 31, 2015 March 31, 2014

Subsidiary Companies

First Airways Inc 100% Investment 477.50 477.50 477.50

TAAL Tech India Private Limited 85% Investment 85.00 85.00 85.00

Katra Auto Engineering Private Limited 100% Investment 5.00 5.00 -

TAAL Enterprises Limited 100% Investment 5.00 5.00 -

TAAL Tech India Private Limited * 85% Advance 898.26 401.44 690.16

Receivable

Katra Auto Engineering Private Limited * # 100% Advance 646.00 646.00 645.50

Receivable

Associate Companies

ISMT Limited * - Advance 497.07 242.37 -

Receivable

ISMT Limited * - Loan Payable 910.31 - 843.51

LightO Technologies Private Limited * - Advance 680.04 680.04 -

Receivable

Indian Seamless Enterprises Limited * - Advance 220.61 - 34.36

Receivable

TAAL Aerosystems Private Limited 30% Investment 0.75 - 0.75

* These loans and advances fall under the category of loans and advances in the nature of loans where there is no repayment schedule

and are repayable on demand.

# This loan is interest free and was given to the subsidiary for purchase of land. (Refer Note No. 37)

b) Investment by the loanee in the shares of the parent company and subsidiary company, when the Company has made a loan or

advance in the nature of loan:

Investment held by Indian Seamless Enterprises Limited in Taneja Aerospace and Aviation Limited - 1,09,64,620 Equity Shares

(Previous Year 1,09,64,620 Equity Shares).

Investment held by Lighto Technologies Private Limited in Taneja Aerospace and Aviation Limited - 45,717 Equity Shares

(Previous Year 45,717 Equity Shares).


42


32 Disclosure in respect of Related Parties pursuant to Accounting Standard 18

Relationship Name of the Related Party

a. Subsidiary Companies First Airways Inc

TAAL Tech India Private Limited *

Katra Auto Engineering Private Limited **

TAAL Enterprises Limited **

TAAL Technologies Inc (Subsidiary of TAAL Tech India Private Limited)

TAAL Tech GMBH (Subsidiary of TAAL Tech India Private Limited) #

b. Associate Companies ISMT Limited

LightO Technologies Private Limited

Indian Seamless Enterprises Limited

TAAL Aerosystems Private Limited ^

c. Key Management Personnel Mr. Salil Taneja (Whole Time Director) $

Mr. S M Kapoor (Managing Director) %

Mr. C S Kameswaran (Non Executive Director) ^^

* Ceased to be a Wholly Owned Subsidiary during the year. As at March 31, 2015 the Company holds 85% shares in TAAL Tech

India Private Limited.

** Became Wholly Owned Subsidiaries during the year.

# Became Wholly Owned Subsidiary of TAAL Tech India Private Limited during the year.

^ Applied for Dissolution on March 30, 2015.

$ Appointed as a Whole Time Director w.e.f. December 1, 2014 for a period of two years upto November 30, 2016.

% Appointed as a Managing Director w.e.f. December 1, 2014 for a period of two years upto November 30, 2016. The said Managing

Director resigned on April 1, 2015.

^^ Managing Director upto November 30, 2014. Non Executive Director from December 1, 2014.

Transactions/ Balances with Related Parties: (Rs. in Lakhs)

Particulars Subsidiaries Associates Key Management

Personnel

Investment in Equity Shares made during the year 10.00 - -

(75.00) (-) (-)

Inter-Corporate Deposit Received during the year - 2216.81 -

(-) (656.42) (-)

Inter-Corporate Deposit Given during the year 495.97 1410.15 -

* (844.20) (60.00) (-)

Aircraft Hiring Charges - - -

(-) (240.00) (-)

Sale of Trading Goods - 346.34 -

(-) (-) (-)

Sale Commission on Trading Goods - 6.93 -

(-) (-) (-)

Sale of Goods - 42.53 -

(-) (20.40) (-)

Directors’ Sitting Fees - - 0.40

(-) (-) (0.40)

Rent Paid 3.69 - -

(-) (-) (-)

Interest Paid - 46.38 -

(-) (115.21) (-)


43

Particulars Subsidiaries Associates Key Management

Personnel

Interest Income 97.68 22.77 -

(62.91) (-) (-)

Managerial Remuneration # - - 65.62

(-) (-) (26.76)

Remuneration to Non Executive Director # - - 3.00

(-) (-) (-)

Guarantee given to bank on behalf of others 760.00 - -

(-) (-) (-)

Balance Payable as at year end - - 39.93

(-) (843.51) (-)

Balance Receivable as at year end 1047.44 1187.51 -

(690.16) (34.36) (-)

(Figures in brackets relate to previous year)

* Includes Rs. 766.44 Lakhs which was debited as Difference between Assets and Liabilities transferred by way of Hive Off of

Engineering Design Services Division of the Company to its Subsidiary ‘TAAL Tech India Private Limited’ (Refer Note No. 39).

# Excludes contribution to Gratuity Fund and Provision for Leave Encashment as separate figures are not ascertainable for the

Managerial Personnel. Further, the Company has not paid any commission to the Managerial Personnel.

Note: No amounts pertaining to related parties have been provided for as doubtful debts. Also, no amounts have been written off or

written back during the year.

33 The Accounting Standard 15 (Revised 2005) on “Employee Benefits” has been adopted by the Company effective from

April 1, 2007.

a. Defined Contribution Plan :

The Company has recognised the following amount as an expense and included under the head “ Personnel Cost”:

(Rs. in Lakhs)


March 31, 2015 March 31, 2014

Employer’s Contribution to Provident Fund, Family Pension Fund and 46.36 58.73

Other Funds

b. Defined Benefit Plan as per Actuarial Valuation:

I. Changes in present value of Defined Benefit Obligations: (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Gratuity (Funded)

Present Value of Obligations as at 1st April, 2014 (1st April, 2013) 81.81 74.69

Current Service Cost 8.93 7.45

Interest Cost 6.83 6.09

Past Service Cost - -

Actuarial (Gain)/Loss 12.68 -5.70

Benefits Paid -15.22 -0.72

Present Value of Obligations as at 31st March, 2015 (31st March,2014) 95.03 81.81

Leave Encashment (Non Funded)







Present Value of Obligations as at 31st March, 2015 (31st March, 2014) 45.77 34.46



44


II. Changes in fair value of plan assets: The Company has not made any investment in plan assets and therefore, there

are no changes in fair value and returns thereon.

III. Amounts recognized in the Balance Sheet in respect of: (Rs. in Lakhs)

Particulars Gratuity (Funded) Leave Encashment

(Non Funded)

As at As at As at As at


Present Value of Obligation as at 31st March, 2015 95.03 81.81 45.77 34.46

(31st March, 2014)

Less: Funded with LIC 4.36 13.27 - -

Net Liability 90.67 68.55 45.77 34.46

IV. Expenses recognised in the Statement of Profit & Loss (under the head “Personnel Cost”): (Rs. in Lakhs)


(Non Funded)



Current Service Cost 8.93 7.45 6.69 5.41

Interest Cost 6.83 6.09 2.93 2.64

Past Service Cost - - - -

Actuarial (Gain)/ Loss 12.68 -5.70 7.01 -1.50

Expenses recognised in the Statement of Profit and Loss 28.44 7.85 16.63 6.55

V. Principal Actuarial Assumptions used as at the Balance Sheet date:


(Non Funded)



Discount Rate 7.80% 8.20% 7.80% 8.20%

Salary Escalation Rate 5%-10% 12.46% 5%-10% 12.46%

Discount Rate: The discount rate is based on the prevailing market yields of Indian Government Securities as at the Balance Sheet date

for the estimated term of the obligations.

Salary Escalation Rate: The estimates of future salary increases, considered in actuarial valuation, takes into account the inflation,

seniority, promotion and other relevant factors such as supply and demand in the employment market.

34 Segment Reporting (Rs. in Lakhs)

Particulars Aviation Charter Trading of Engg Total Aviation Engg Design Total

Business * Electrical Des ign 2014-15 Service # 2013-14

Goods ^ Service #

a. Segment Revenue

Segmental Revenue from :

External Sales and Services 2097.82 717.16 353.27 - 3168.25 4196.14 1152.22 5348.36

Unallocable Revenue 358.75 123.69

Total Revenue 2097.82 717.16 353.27 - 3527.00 4196.14 1152.22 5472.05

b. Segment Result

Operating Profit/(Loss) -636.20 -334.41 6.93 - -963.69 85.55 204.40 289.95

Add: Unallocable Revenue 358.75 123.69

Less: Finance Costs 694.44 543.27

Less: Extraordinary Items 9.70 2.46

Profit/ (Loss) before Tax -1309.08 -132.10

Less: Tax (Benefit)/ Expense 8.31 -

Add: Deferred Tax Liability 564.38 -

Written Back

Loss for the Year -753.02 -132.10


45



Business * Electrical Des ign 2014-15 Service # 2013-14

Goods ^ Service #

c. Other Information

Segment Assets 13098.80 737.03 265.11 - 14100.94 14957.77 - 14957.77

Unallocable Assets 2770.78 4000.33

Total Assets 16871.72 18958.10

Segment Liabilities 1920.76 194.98 276.51 - 2392.24 1775.89 - 1775.89

Unallocable Liabilities 4417.69 6320.51

Total Liabilities 6809.93 8096.40

Capital Employed 10061.79 10861.70

d. Cost Incurred for Acquiring

Assets 589.98 0.31 - - 590.30 1211.25 85.42 1296.67

Segment Depreciation 341.32 4.61 - - 345.93 342.12 10.31 352.43

# Refer Note No. 39

* The Company has identified Charter Business as its business segment w.e.f. the current financial year. Hence, comparative figures

for the previous period for Charter Business is not reported.

^ Trading of Electrical Goods represents new business started by the Company during the year (Refer Note No. 38). Hence,

comparative figures for the previous period for Trading of Electrical Goods is not reported.

As per Accounting Standard 17, the Company has three segments viz “Aviation, Charter Business and Trading of Electrical Goods”.

(i) Revenue and Expenses have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue

and Expenses which relate to Enterprise as a whole and are not allocable to a segment on reasonable basis have been disclosed as

unallocable.

(ii) Segment Assets and Segment Liabilities represent Assets and Liabilities in respective Segments. Investments, Tax Related Assets

and Other Assets and Liabilities which cannot be allocated to a segment on a reasonable basis have been included under Unallocable

Assets and Liabilities.

35 The Company does not enter into any forward foreign exchange contracts.

Foreign currency exposure not hedged as at March 31, 2015 are as under:

Particulars As at March 31, 2015 As at March 31, 2014

(in Lakhs) (in Lakhs)

Foreign INR Foreign INR

Currency Currency

Expenses Payable

USD - - 0.29 17.62

Lease Rent Payable

USD 1.29 80.66 1.72 103.10

80.66 120.72

Trade Receivable

USD 0.12 7.63 - -

7.63 -

36 The Board of Directors of the Company have in their meeting held on October 9, 2014, approved the Scheme of Arrangement(“Scheme”) under the Companies Act, 1956/ 2013 between Taneja Aerospace and Aviation Limited (‘TAAL’) and its whollyowned subsidiary TAAL Enterprises Limited (‘TEL’), where the Charter Business including investment in First Airways Inc, USA(Wholly Owned Subsidiary) and Engineering Design Services Business conducted through TAAL Tech India Private Limited(Subsidiary) would be demerged into TEL with appointed date as October 1, 2014. The excess of book value of assets over thebook value of liabilities to be transferred will be adjusted against Securities Premium Account (amounting to Reduction in ShareCapital) as approved by the shareholders at the Extra Ordinary General Meeting held on April 15, 2015.

Pursuant to the Demerger, shareholders of the Company will get 1 fully paid up Equity Share of Rs. 10 each of TEL for every 8fully paid up Equity Shares of Rs. 5 each held in the Company.

After clearance of the draft Scheme by the shareholders and various regulatory authorities, the Company’s petition was admittedby the Hon’ble Madras High Court on April 29, 2015 and order sanctioning the Scheme has been received on July 23, 2015.

Effect of the Scheme will be given upon filing the aforesaid copy of the Scheme to the concerned Registrar of Companies and the

Scheme becoming effective (Effective Date).


46


In accordance with Accounting Standard 24, “Discontinuing Operations”, the financial results of the Air Charter Business and

Engineering Design Services Business (discontinuing operations) are as under:

(As prepared and certified by the Management) (Rs. in Lakhs)

Particulars Year ended March 31, 2015 Year ended March 31, 2014

Air Engg. Total Air Engg. Total

Charter Design* Charter Design*

a) Statement of Profit and Loss

Revenue from Operations 713.26 - 713.26 802.58 1,152.22 1,954.80

Other Income 3.37 - 3.37 3.51 41.87 45.38

Total Revenue 716.64 - 716.64 806.09 1,194.09 2,000.18

Cost of Material Consumed 28.27 - 28.27 2.47 - 2.47

Employee Benefits Expense 94.00 - 94.00 82.38 746.40 828.78

Finance Costs 10.97 - 10.97 4.02 17.48 21.50

Depreciation & Amortisation 4.61 - 4.61 8.19 10.31 18.50

Other Expenses 924.69 - 924.69 675.82 233.98 909.80

Total Expenses 1,062.54 - 1,062.54 772.88 1,008.17 1,781.05

(Loss) / Profit from Discontinuing (345.90) - (345.90) 33.21 185.92 219.13

Operations before Tax

Less : - Tax Expenses - - - - - -

Net (Loss) / Profit from Discontinuing (345.90) - (345.90) 33.21 185.92 219.13

Operations after Tax

b) Carrying amount of Assets and Liabilities

Carrying amount of assets as at the balance 1,237.91 85.00 1,322.91 1,566.96 85.00 1,651.96

sheet date relating to discontinuing business

to be disposed off

Carrying amount of liabilities as at the balance 194.69 - 194.69 176.06 - 176.06


to be settled

c) Net Cash Flow Attributable to

the ‘Discontinuing Operations’:

Cash flow from Operating activities 9.80 - 9.80 (57.58) 107.15 49.57

Cash flow from Investing activities (0.31) - (0.31) 54.60 (85.42) (30.83)

Cash flow from Financing activities (10.97) - (10.97) (4.02) (17.48) (21.50)

Net Cash Inflow / (Outflow) (1.48) - (1.48) (7.00) 4.25 (2.75)

* Refer Note Nos 39 & 44

37 Katra Auto Engineering Private Limted purchased land for the Company out of interest free advance of Rs. 646 Lakhs (Upto

Previous Year Rs. 645.50 Lakhs) provided by the Company. As on 11th June, 2014, Katra Auto Engineering Private Limited has

become 100% Subsidiary of the Company and therefore during the year, the said advance given to Katra Auto Engineering Private

Limted has been transferred to Long Term Capital Advances from Capital Work-in-Progress.

38 In line with the objects of the Company and as approved by the Board, the Company has started during the current year trading

in electrical goods.

39 The shareholders of the Company had by way of postal ballot passed a resolution dated 5th August, 2013 approving the transfer

of Assets and Liabilities of the Company’s Engineering Design Services Division to its Subsidiary ‘TAAL Tech India Private

Limted’, with effect from 1st August, 2013. Accordingly, related Assets and Liabilities were transferred at their book values and the

excess of Assets over Liabilities amounting to Rs. 766.44 Lakhs was treated as Inter Corporate Deposit to Subsidiary.


47










40 The Company considers its investment in and loans to subsidiaries as strategic and long term in nature and accordingly, in the view

of the management, any decline in the value of such long term investments in subsidiaries is considered as temporary in nature and

hence no provision for dimunition in value is considered necessary.

41 The balances in Debtors and Creditors accounts are subject to confirmations and reconciliations if any.

42 Current Assets, Loans and Advances are of the value stated if realised in the ordinary course of business.

43 In the Opinion of the Board, adequate steps are taken to make sufficient provision for all liabilities.

44 Consequent to Hive Off of Engineering Design Services Division (Refer Note No. 39), the Statement of Profit and Loss and the

Cash Flow Statement of the previous year consists of the Results and Cash Flows of Engineering Design Services Division upto

31st July, 2013. Hence the current year figures are not comparable with the previous year figures.

45 Previous year figures have been regrouped and reclassified wherever necessary to conform to the current year classification.


48

Consolidated

Financial

Statements


49

To the Members of TANEJA AEROSPACE AND AVIATION

LIMITED

Report on the Consolidated Financial Statements

We have audited the accompanying consolidated financial

statements of Taneja Aerospace and Aviation Limited (hereinafter

referred to as “the Holding Company”) and its subsidiaries (the

Holding Company and its subsidiaries together referred to as “the

Group”), comprising of the Consolidated Balance Sheet as at

March 31, 2015, the Consolidated Statement of Profit and Loss,

the Consolidated Cash Flow Statement for the year then ended,

and a summary of significant accounting policies and other

explanatory information (hereinafter referred to as “the

consolidated financial statements”).

Management’s Responsibility for the Consolidated Financial

Statements

The Holding Company’s Board of Directors is responsible for the

preparation of these consolidated financial statements in terms of

the requirements of the Companies Act, 2013 (hereinafter referred

to as “the Act”) that give a true and fair view of the consolidated

financial position, consolidated financial performance and

consolidated cash flows of the Group in accordance with the

accounting principles generally accepted in India, including the

Accounting Standards specified under Section 133 of the Act, read

with Rule 7 of the Companies (Accounts) Rules, 2014. The

respective Board of Directors of the companies included in the

Group are responsible for maintenance of adequate accounting

records in accordance with the provisions of the Act for safeguarding

the assets of the Group and for preventing and detecting frauds

and other irregularities; the selection and application of appropriate

accounting policies; making judgments and estimates that are

reasonable and prudent; and the design, implementation and

maintenance of adequate internal financial controls, that were

operating effectively for ensuring the accuracy and completeness

of the accounting records, relevant to the preparation and

presentation of the financial statements that give a true and fair

view and are free from material misstatement, whether due to

fraud or error, which have been used for the purpose of preparation

of the consolidated financial statements by the Directors of the

Holding Company, as aforesaid.

Auditor’s Responsibility

Our responsibility is to express an opinion on these consolidated

financial statements based on our audit. While conducting the audit,

we have taken into account the provisions of the Act, the accounting

and auditing standards and matters which are required to be included

in the audit report under the provisions of the Act and the Rules

made thereunder.

We conducted our audit in accordance with the Standards on

Auditing specified under Section 143(10) of the Act. Those

Standards require that we comply with ethical requirements and

plan and perform the audit to obtain reasonable assurance about

whether the consolidated financial statements are free from material

misstatement.

An audit involves performing procedures to obtain audit evidence

about the amounts and the disclosures in the consolidated financial

statements. The procedures selected depend on the auditor’s

judgment, including the assessment of the risks of material

misstatement of the consolidated financial statements, whether

due to fraud or error. In making those risk assessments, the auditor

considers internal financial control relevant to the Holding

Company’s preparation of the consolidated financial statements

that give a true and fair view in order to design audit procedures

that are appropriate in the circumstances but not for the purpose

of expressing an opinion on whether the Holding Company has an

adequate internal financial controls system over financial reporting

in place and the operating effectiveness of such controls. An audit

also includes evaluating the appropriateness of the accounting

policies used and the reasonableness of the accounting estimates

made by the Holding Company’s Board of Directors, as well as

evaluating the overall presentation of the consolidated financial

statements.

We believe that the audit evidence obtained by us and the audit

evidence obtained by the other auditors in terms of their reports

referred to in Other Matters paragraph below, is sufficient and

appropriate to provide a basis for our qualified audit opinion on

the consolidated financial statements.

Basis for Qualified Opinion

1) The Holding Company has debited Rs. 34.74 Lakhs under

advertisement and travelling expenses being

reimbursement to a group company for which no

evidence/supporting is provided. This has resulted in

overstatement of loss for the year and understatement of

amount receivable from the group company by Rs. 34.74

Lakhs.

2) The Holding Company during the year commenced the

business of trading in electrical goods (Refer Note No.

40) where in sales are only to LightO Technologies Private

Limited (a related party). Further, the Holding Company

also gave Inter Corporate Deposit to the said related party

which was in excess of the amount approved by the audit

committee by Rs.185 Lakhs. As at March 31, 2015, the

Holding Company has to receive Rs. 256.31 Lakhs against

sale of goods and Rs. 688.84 Lakhs (including interest)

against Inter Corporate Deposit. We were not provided

with sufficient and appropriate audit evidence about the

recoverability of the above amounts. Consequently, we

are unable to determine whether any adjustments to

these amounts are necessary.

3) We draw attention to Note No. 38 forming part of the

consolidated financial statements, which refers to the

fact that the shareholders of the Holding Company at

their meeting (convened on the directions of the Hon’ble

High Court of Madras) held on April 15, 2015 have

approved the Scheme of Arrangement between the

Holding Company and TAAL Enterprises Limited, a

wholly owned subsidiary of the Holding Company w.e.f.

October 1, 2014 subject to receipt of regulatory approvals.

Further, the above mentioned note also refers to the

proposed Reduction in Share Capital of the Holding

Company as a consequence of the said Scheme, the terms

of which were approved by the shareholders of the

Holding Company by way of special resolution passed at

their Extraordinary General Meeting held on April 15,

2015. Though the said Scheme was sanctioned by the

INDEPENDENT AUDITORS’ REPORT ON THE CONSOLIDATED

FINANCIAL STATEMENTS


50

Hon’ble High Court of Judicature at Madras on June 22,

2015 (the copy of which was received on July 23, 2015)

i.e. before the adoption of consolidated accounts by the

Board of Director’s on August 14, 2015, the effect of the

said Scheme is not given in the consolidated accounts.

We are unable to determine its impact, if any, on the

consolidated financial statements.

4) The Holding Company needs to strengthen its policies,

procedures and overall controls in order to provide proper

evidences regarding recoverability of debtors, valuation

of work in progress and accounting for direct and indirect

taxes including statutory compliances. We are unable to

determine its impact, if any, on the consolidated financial

statements.

Qualified Opinion

In our opinion and to the best of our information and according

to the explanations given to us, except for the possible effects

of the matters described in the Basis for Qualified Opinion

paragraph above, the aforesaid consolidated financial

statements give the information required by the Act in the

manner so required and give a true and fair view in conformity

with the accounting principles generally accepted in India, of

the consolidated state of affairs of the Group as at March 31,

2015, and their consolidated loss and their consolidated cash

flows for the year ended on that date.

Emphasis of Matter

The Holding Company has outstanding MAT Credit

Entitlement of Rs. 134.69 Lakhs as on March 31, 2015, which

in the opinion of the management, based on the projected

future taxable profits, will be utilized within the stipulated

time period prescribed as per the provisions of Income Tax

Act, 1961. Considering the uncertainties around the

assumptions used for projections of future taxable profits

and its consequential effect on utilization of MAT Credit

Entitlement, we are unable to comment on the recoverability

of MAT Credit Entitlement outstanding as at March 31, 2015

and its consequential impact on the Consolidated Statement

of Profit and Loss for the year ended March 31, 2015 and on

the Reserves of the Group as on that date (Refer Note No. 19).

Our opinion is not qualified in respect of this matter.

Other Matters

a. The financial statement of a subsidiary, whose financial

statement reflects total assets of Rs. 2105.90 Lakhs as at

31st March, 2015, total revenues of Rs. 5027.58 Lakhs and

net cash inflows amounting to Rs.139.28 Lakhs for the year

then ended, as considered in the consolidated financial

statements, have been jointly audited by us with other joint

auditor, MZSK & Associates, Chartered Accountants.

b. We did not audit the financial statements of four subsidiaries,

whose financial statements reflect total assets of

Rs. 912.95 Lakhs as at 31st March, 2015, total revenues of

Rs. 326.65 Lakhs and net cash inflows amounting to

Rs. 21.09 Lakhs for the year/ period then ended, as considered

in the consolidated financial statements. These financial

statements have been audited by other auditors whose reports

have been furnished to us by the Management and our opinion

on the consolidated financial statements, in so far as it relates

to the amounts and disclosures included in respect of these

subsidiaries and our report in terms of sub-sections (3) and

(11) of Section 143 of the Act, in so far as it relates to the

aforesaid subsidiaries, is based solely on the reports of the

other auditors.

c. The consolidated financial statements also contain the

unaudited financial statement in respect of a subsidiary, whose

unaudited financial statement reflects total assets of Rs.16.88

Lakhs as at March 31, 2015, and total revenues of Rs. Nil for

the period ended on that date, as considered in the consolidated

financial statements. This unaudited financial statement has

been furnished to us by the Management and our opinion on

the consolidated financial statements, in so far as it relates to

the amounts and disclosures included in respect of this

subsidiary and our report in terms of sub-sections (3) and

(11) of Section 143 of the Act, in so far as it relates to the

aforesaid subsidiary, is based solely on such unaudited financial

statement. In our opinion and according to the information

and explanations given to us by the Management, this financial

statement is not material to the Group.

d. Our opinion on the consolidated financial statements, and our

Report on Other Legal and Regulatory Requirements below,

is not modified in respect of the above matters with respect

to our reliance on the work done and the reports of the other

auditors and the financial statement certified by the

Management.

Report on Other Legal and Regulatory Requirements

1. As required by the Companies (Auditor’s Report) Order,

2015 (“the Order”) issued by the Central Government of

India in terms of sub-section (11) of section 143 of the Act,

based on the comments in the auditors’ reports of the Holding

Company and the subsidiary companies incorporated in India,

to the extent reported by the statutory auditors of such

companies, we give in the Annexure a statement on the matters

specified in paragraphs 3 and 4 of the Order, to the extent

applicable.

2. As required by Section 143 (3) of the Act, we report to the

extent applicable, that:

(a) We have sought and obtained, except for the matters

described in the Basis for Qualified Opinion paragraph

above, all the information and explanations which to the

best of our knowledge and belief were necessary for the

purposes of our audit of the consolidated financial

statements.

(b) Except for the possible effects of the matters described

in the Basis for Qualified Opinion paragraph above, in

our opinion, proper books of account as required by law

relating to the preparation of aforesaid consolidated

financial statements have been kept so far as it appears

from our examination of those books and the reports of

the other auditors.

(c) The Consolidated Balance Sheet, the Consolidated

Statement of Profit and Loss and the Consolidated Cash

Flow Statement dealt with by this Report are in agreement

with the relevant books of account maintained for the

purpose of preparation of the consolidated financial

statements.

(d) Except for the possible effects of the matters described

in the Basis for Qualified Opinion paragraph above, in

our opinion, the aforesaid consolidated financial

statements comply with the Accounting Standards, except


51

AS-2 “Valuation of Inventories”, specified under section

133 of the Act, read with Rule 7 of the Companies

(Accounts) Rules, 2014.

(e) The matters described in the Basis for Qualified Opinion

paragraph above, in our opinion, may have an adverse

effect on the functioning of the Group.

(f) On the basis of the written representations received from

the directors of the Holding Company as on March 31,

2015, taken on record by the Board of Directors of the

Holding Company and the reports of the statutory

auditors of the subsidiary companies incorporated in

India, to the extent reported by the statutory auditors of

such companies, none of the directors of the Group

companies incorporated in India, is disqualified as on

March 31, 2015 from being appointed as a director in

terms of Section 164(2) of the Act.

(g) The qualification relating to the maintenance of accounts

and other matters connected therewith are as stated in

the Basis for Qualified Opinion paragraph above.

(h) With respect to the other matters to be included in the

Auditor’s Report in accordance with Rule 11 of the

Companies (Audit and Auditors) Rules, 2014, in our

opinion and to the best of our information and according

to the explanations given to us:

i. The consolidated financial statements disclose the

impact of pending litigations on the consolidated

financial position of the Group as referred to in

Note No. 29 to the consolidated financial statements.

ii. The Group did not have any long-term contracts

including derivative contracts for which there were

any material foreseeable losses.

iii. There were no amounts which were required to be

transferred to the Investor Education and Protection

Fund by the Holding Company and its subsidiaries

in India.




Haresh B. Shah

Partner



52

As stated in Para 1 of ‘Report on Other Legal and Regulatory

Requirements’ in our Auditors’ Report of even date, the following

statement is based on the comments in the auditors’ reports on the

standalone financial statements of the Holding Company and three

subsidiary companies incorporated in India, to the extent considered

applicable for reporting under the Order in the case of the consolidated

financial statements.

(i) In respect of the fixed assets of the Holding Company and its

subsidiary companies incorporated in India:

a. The respective entities have maintained proper records

showing full particulars, including quantitative details

and situation of fixed assets.

b. Some of the fixed assets were physically verified during

the year by the management of the respective entities

in accordance with a program of verification which, in

our opinion and the opinion of the other auditors,

provides for physical verification of all the fixed assets

at reasonable intervals. According to the information

and explanation given to us and the other auditors, no

material discrepancies were noticed on such verification

as compared to the book records.

(ii) Subsidiary companies incorporated in India do not have

inventory. In respect of the inventories of the Holding

Company:

a. As explained to us, inventories have been physically

verified during the year by the Management of the

Holding Company. In our opinion, the frequency of

such verification is reasonable.

b. The procedures of physical verification of inventories

followed by the Management of the Holding Company

are generally reasonable and adequate in relation to the

size of the Holding Company and the nature of its

business.

c. The Holding Company has maintained proper records

of inventory except in the case of Work in Progress.

No material discrepancies were noticed on verification

between the physical stocks and the book records. In

our opinion, the present operative modules of ERP are

insufficient to ascertain the cost and arrive at proper

valuation of Work in Progress as per the Accounting

Policies and Accounting Standards specified under

Section 133 of the Act, read with Rule 7 of the

Companies (Accounts) Rules, 2014.

(iii) According to the information and explanations given to us

and the other auditors, none of the subsidiary companies

incorporated in India have granted any loans, secured or

unsecured, to companies, firms or other parties covered in

the register maintained under section 189 of the Companies

Act, 2013 by those subsidiary companies. However, during

the year under audit, the Holding Company has granted fresh

unsecured loans by way of Inter Corporate Deposit to five

companies (including subsidiaries whose accounts are

consolidated) covered in the register maintained under section

189 of the Companies Act, 2013. The aggregate maximum

amount outstanding during the year was Rs. 2022.25 Lakhs

and the aggregate year-end balance of such loans amounted

to Rs. 1978.64 Lakhs.

a. In respect of the unsecured loans granted by the Holding

Company, there are no stipulations for the repayment

of principal and the interest thereon. Therefore, we are

unable to comment on the regularity of receipt of the

principal amount and interest thereon.

b. No principal or interest can be termed as overdue in the

absence of terms of repayment and thus we are unable

to comment on the steps taken by the Holding Company

for recovery of principal and interest thereon.

(iv) In our opinion and according to the information and

explanations given to us, the internal control system in the

Holding Company is inadequate considering the size of the

company and the nature of its business with regard to purchase

of inventories and for the sale of goods and services. Further,

there is a continuing failure to correct major weakness in

internal control systems of the Holding Company in the

areas of debtors, valuation of work in progress and accounting

for direct and indirect taxes including statutory compliances

(Refer paragraph 4 of Basis for Qualified Opinion above).

However, according to the information and explanations

obtained by the auditors of the subsidiary companies

incorporated in India, there is an adequate internal control

system in all the subsidiary companies commensurate with

the respective size of each company and the nature of their

business with regard to purchase of fixed assets and for

rendering of services. The activities of subsidiary companies

do not involve purchase of inventory and the sale of goods.

During the course of audit by the statutory auditors of the

subsidiary companies incorporated in India, no major

weakness in the internal control system in any of these

companies has been observed.

(v) As per the explanations given to us and the other auditors,

the Holding Company and its subsidiary companies

incorporated in India have not acceptedany deposits from

the public in accordance with the provisions of Sections 73

to 76 of the Act and the rules framed thereunder. Accordingly,

the provisions stated in paragraph 3 (v) of the Order is not

applicable to the Group.

(vi) The cost accounts and records of the Holding Company were

not made available to us. Hence, we are unable to comment

on the maintenance of cost records as specified by the Central

Government under Section 148(1) of the Companies Act,

2013. However, in case of subsidiary companies incorporated

in India, the Central Government has not prescribed the

maintenance of cost records under Section 148(1) of the

Companies Act, 2013 for the services of these companies.

(vii) a) According to the information and explanations given

to us and the other auditors and on the basis of our

examination of the records of the Holding Company

and subsidiary companies incorporated in India, amounts

deducted/accrued in the books of account in respect of

undisputed statutory dues including Provident Fund,

Employees’ State Insurance, Income Tax, Sales Tax/

Value Added Tax, Wealth Tax, Service Tax, Customs

Duty, Excise Duty and other material statutory dues

have generally been regularly deposited during the year

by the subsidiary companies with the appropriate

authorities. However the Holding Company is irregular

in depositing undisputed statutory dues applicable to it

with the appropriate authorities during the year.

Further, in the case of Holding Company, Tax Deducted

at Source (TDS) amounting to Rs. 21.94 Lakhs and

Annexure to the Independent Auditor’s Report on the Consolidated Financial Statements

(Referred to in paragraph 1 under ‘Report on Other Legal and Regulatory Requirements’ section of our report of even date)


53

Service Tax amounting to Rs.42.31 Lakhs are in arrears

as at March 31, 2015 for a period of more than six

months from the date they became payable. In the case

of subsidiary companies incorporated in India, no

undisputed amounts payable were in arrears as at March

31, 2015 for a period of more than six months from the

date they became payable.

b) According to the information and explanations given

to us and the other auditors, there are no dues of Income

Tax, Sales Tax/ Value Added Tax, Wealth Tax, Service

Tax, Customs Duty, Excise Duty and cess as at 31 March,

2015 which have not been deposited by the subsidiary

companies incorporated in India, with the appropriate

authorities on account of any dispute. However, dues

that have not been deposited by the Holding Company

on account of disputes are :

Name of Nature of Period to Amount Amount Forum where

the Statute Dues which it under paid the dispute is

relates dispute under pending

(Rs. in protest

Lakhs) (Rs. in

Lakhs)

Customs Act, Custom F.Y. 2007-08 622.67 - CESTAT

1962 Duty

Finance Act, Service F.Y. 2005-06 317 10 CESTAT

1994 Tax to

F.Y. 2009-10


Act, 1944 Duty

Central Excise Excise F.Y. 2013-14 57.50 - Adjudicating

Act, 1944 Duty to Authority

F.Y. 2014-15


Act, 1944 Duty to

F.Y. 2011-12

Finance Act, Service F.Y. 2008-09 124.37 - CESTAT

1994 Tax to

F.Y. 2012-13

Sales Tax Sales Tax F.Y. 2007-08 55.00 - Adjudicating

to Authority

F.Y. 2009-10

c) There are no amounts required to be transferred by the

Group to the Investor Education and Protection Fund

in accordance with the relevant provisions of the

Companies Act, 1956 (1 of 1956) and rules made

thereunder.

(viii) The Group does not have consolidated accumulated losses at

the end of the financial year. The Group has incurred cash

losses on a consolidated basis during the financial year covered

by our audit. However it had not incurred any cash losses on

a consolidated basis in the immediately preceding financial

year.

(ix) In our opinion and the opinion of the other auditors and

according to the information and explanations given to us

and the other auditors, the Group has not defaulted during

the year in repayment of dues to financial institutions or

banks. The Group did not have any outstanding debentures

during the year.

(x) According to the information and explanations given to us

and the other auditors, the subsidiary companies incorporated

in India have not given any guarantee for loans taken by

others from banks or financial institutions during the year.

Further, in our opinion, the terms and conditions of the

guarantee given by the Holding Company for loan taken by

its subsidiary from bank is not, prima facie, prejudicial to the

interest of the Holding Company. (Refer Note No. 29B on

guarantee given to bank by parent on behalf of subsidiary).

(xi) According to the information and explanations given to us

and the other auditors, the subsidiary companies incorporated

in India have not obtained any term loans during the year.

Further, in our opinion, the Term Loan of Rs. 800 Lakhs

raised by the Holding Company during the period under audit,

has on an overall basis, been applied for the purposes for

which the said loans were obtained.

(xii) To the best of our knowledge and according to the information

and explanations given to us and the other auditors, no

material fraud on or by the Holding Company and its

subsidiary companies incorporated in India has been noticed

or reported during the year, except for a fraud on one of the

subsidiaries amounting to Rs. 11.36 Lakhs, committed by its

employees in the HR department in the form of dubious

recruitment commission. The said amount has been fully

recovered and the employees have been removed from

employment.




Haresh B. Shah

Partner



54

Consolidated Balance Sheet as at March 31, 2015 (Rs. in Lakhs)

Particulars Note As at As at

No. March 31, 2015 March 31, 2014

EQUITY AND LIABILITIES

Shareholders’ Funds

Share Capital 2 1246.54 1246.54

Reserves and Surplus 3 8658.32 9438.09

9904.85 10684.63

Minority Interest 39.75 -

Non-Current Liabilities

Long-Term Borrowings 4 2902.05 2542.65

Deferred Tax Liabilities (Net) 5 (12.82) 581.97

Other Long-Term Liabilities 6 849.03 848.03

Long-Term Provisions 7 208.38 144.48

3946.65 4117.13

Current Liabilities

Short-Term Borrowings 8 1562.84 2355.06

Trade Payables 9 872.42 687.47

Other Current Liabilities 10 1589.37 1241.30

Short-Term Provisions 11 319.11 198.39

4343.74 4482.22

Total 18234.99 19283.98

ASSETS

Non-Current Assets

Goodwill on Consolidation 39 0.78 -

Fixed Assets 12

Tangible Assets 12645.21 12028.76

Intangible Assets 116.00 -

Capital Work-In-Progress 195.23 476.18

12956.44 12504.94

Non-Current Investments 13 - 0.57

Long Term Loans and Advances 14 138.82 718.74

Other Non-Current Assets 15 116.01 167.06

Current Assets

Inventories 16 486.99 423.50

Trade Receivables 17 1615.98 2121.54

Cash and Bank Balances 18 585.49 1038.19

Short-Term Loans and Advances 19 2265.60 2250.76

Other Current Assets 20 68.88 58.67

5022.94 5892.66

Total 18234.99 19283.98


Notes are an Integral part of the Consolidated Financial Statements 2 - 47










55

Consolidated Statement of Profit and Loss for the year ended March 31, 2015 (Rs. in Lakhs)

Particulars Note Year ended Year ended

No. 31st March 2015 31st March 2014

INCOME

Revenue from Operations (Net) 21 7794.25 8227.52

Revenue from Trading Activities 22 353.27 -

Other Income 23 309.38 60.78

Total Revenue 8456.90 8288.30

EXPENSES

Cost of Materials Consumed 24 550.97 1537.53

Purchase of Trading Goods 346.34 -

Changes in Inventory of Work-In-Progress 25 (7.00) 47.51

Operational and Other Expenses 26 3164.92 2108.20

Employee Benefits Expense 27 4392.30 3653.15

Finance Costs 28 754.05 558.17

Depreciation & Amortisation Expense 12 527.86 464.28

Total Expenses 9729.44 8368.83

Loss before Extraordinary Items and Tax (1272.54) (80.54)

Less: Prior Period Items 16.80 2.46

Less: Permanent Diminution in Investment in Associate 13 0.60 -

Loss before Tax (1289.94) (83.00)

Tax Expense:

Current Tax 61.96 22.67

FBT for Earlier Year 0.42 -

Short Tax Provision for Earlier Years 7.89 -

Deferred Tax (Benefit)/ Expense 5 (30.41) 17.59

Total Tax (Benefit)/Expense 39.86 40.26

Deferred Tax Liability Written Back 5 (564.380 -

Loss after Tax but before Share in Loss of Associate and (765.42) (123.25)

Minority Interest

Less: Share in Loss of Associate - 0.05

Less: Minority Interest 7.54 -

Loss for the Year (772.96) (123.30)

Profit/(Loss) from continuing operations before tax (1,058.70) (414.63)

Tax Expense (556.07) -

Profit/(Loss) from continuing operations after tax (502.63) (414.63)

Profit/(Loss) from discontinuing operations before tax 38 (231.24) 331.63

Tax Expense 38 31.55 40.26

Profit/(Loss) from discontinuing operations after tax (262.79) 291.38

Earnings per equity share (In Rs.) - Basic and Diluted 30 (3.10) (0.49)

(Face value of Rs. 5/- each)


Notes are an Integral part of the Consolidated Financial Statements 2 - 47










56

Consolidated Cash Flow Statement for the year ended March 31, 2015 (Rs. in Lakhs)


March 31, 2015 March 31, 2014

A CASH FLOW FROM OPERATING ACTIVITIES

Loss before extraordinary items and tax (1272.54) (80.53)

Adjustments for :

Depreciation & Amortisation Expense 527.86 464.28

Prior Period Items (16.80) (2.46)

Finance Costs 754.05 558.17

Interest Income (195.38) (39.01)

Operating Profit before Working Capital Changes (202.80) 900.45

Adjustments for :

Trade and Other Receivables 308.03 (1459.56)

Inventories (63.49) 153.14

Trade and Other Payables 151.38 860.80

Cash Generated from Operations 193.11 454.83

Income Tax Paid (Net of Refunds) 154.82 (65.38)

Net Cash Flow from Operating Activities 347.93 389.45

B CASH FLOW FROM INVESTING ACTIVITIES

Purchase of Fixed Assets including Capital WIP (377.68) (985.50)

Amount infused by Minority Stakeholder in Subsidiary 65.06 -

Investment in Equity Shares - (0.57)

Minority Interest (39.75) -

Foreign Currency Translation Reserve 7.21 24.47

Net Cash Flow used in Investing Activities (345.16) (961.61)

C CASH FLOW FROM FINANCING ACTIVITIES

Additions/ (Repayments) of Loans (476.31) 1484.24

Interest Income 195.38 39.01

Finance Costs (738.91) (558.17)

Net Cash Flow (used in)/ from Financing Activities (1019.84) 965.09

Total Cash (Outflow)/ Inflow for the year (1017.08) 392.93

Deferred Tax Liability Written Back (Refer Note No. 5) 564.38 -


Cash and Cash Equivalents at the beginning of the year 1038.19 645.26

Cash and Cash Equivalents at the end of the year 585.49 1038.19


Notes:

1 The above Cash Flow Statement has been prepared under the “Indirect Method” set out in Accounting Standard (AS) - 3 on Cash

Flow Statement issued by the ICAI.

2 Figures in bracket indicate Cash Outflow.

3 Cash and Cash Equivalents are Cash and Bank Balances as mentioned in Note No. 18.










57

Notes to Consolidated Financial Statement for the year ended March 31, 2015

NOTE 1: SIGNIFICANT ACCOUNTING POLICIES

1.1 Basis of Preparation of Consolidated Financial Statements

The Consolidated Financial Statements relate to Taneja Aerospace and Aviation Limited “the Company” and its subsidiaries. The

Company and its subsidiaries together constitute the Group. The consolidated financial statements have been prepared in compliance

with the requirements under section 133 of the Companies Act, 2013 (to the extent notified), read with Rule 7 of the Companies

(Accounts) Rules, 2014, and other generally accepted accounting principles (GAAP) in India, to the extent applicable, on the

accrual basis of accounting, under the historical cost convention, except for certain fixed assets which are being carried at revalued

amounts. GAAP comprises mandatory accounting standards as specified in the Companies (Accounting Standards) Rules, 2006.

Accounting policies not stated explicitly otherwise are consistent with generally accepted accounting principles in India.

1.2 Principles of Consolidation

The financial statements of the subsidiary companies used in consolidation are drawn up to the same reporting date as that of the

Parent Company i.e. year ended March 31, 2015. The consolidated financial statements have been prepared in accordance with

Accounting Standard 21 “Consolidated Financial Statements” on the following principles:

a) The financial statements of the Parent Company and its subsidiary companies have been combined on a line by line basis by

adding together the book value of like items of assets, liabilities, income and expenses, after fully eliminating intra-group

balances and intra-group transactions resulting in unrealised profit or losses.

b) Minority interest in the net income of consolidated subsidiaries for the reporting period has been identified and adjusted

against the income of the group in order to arrive at the net income attributable to the group. Minority interest in the net

assets of the consolidated subsidiaries have been identified and presented in the consolidated balance sheet separately from

liabilities and equity of parent.

c) In case of foreign subsidiaries, being non-integral foreign operations, income and expense items are consolidated at the

average exchange rate prevailing during the period. Assets and liabilities are translated at the closing exchange rate prevailing

at the end of the year. All resulting exchange differences arising on consolidation are recognised in the ‘Foreign Currency

Translation Reserve‘ under ‘Reserves and Surplus’.

d) The difference between the cost of investment in the subsidiary, over the net assets at the time of acquisition of shares in the

subsidiary is recognised in the financial statements as Goodwill or Capital Reserve on consolidation as the case may be.

e) The difference between the cost of investment in the associate and the share of net assets at the time of acquisition of shares

in the associate is recognised in the financial statements as Goodwill or Capital Reserve as the case may be.

f) As far as possible, the consolidated financial statements are prepared using uniform accounting policies for like transactions

and other events in similar circumstances and are presented in the same manner as the Parent Company’s separate financial

statements except as otherwise stated.

g) The following subsidiary companies including indirect subsidiary companies have been considered in the preparation of

consolidated financial statements:

Sr. Name of Relationship Country of Ownership Accounting Audited/

No. the Company Incorporation interest held by Period Unaudited

the Parent as at

March 31, 2015

1 TAAL Tech India Private Direct Subsidiary India 85% Apr14-Mar15 Audited

Limited

2 First Airways Inc. Direct Subsidiary USA 100% Apr14-Mar15 Audited

3 Katra Auto Engineering Direct Subsidiary India 100% Apr14-Mar15 Audited

Private Limited

4 TAAL Enterprises Limited Direct Subsidiary India 100% Jul14-Mar15 Audited

5 TAAL Technologies Inc. Indirect Subsidiary USA 100% Apr14-Mar15 Audited

6 TAAL Tech Innovations Indirect Subsidiary Austria 100% Nov14-Mar15 Unaudited

Gmbh

h) An Associate ‘TAAL Aero systems Private Limited’ has not been considered in the preparation of consolidated financial

statements.


58

Notes to Consolidated Financial Statement for the year ended March 31, 2015 (Contd.)

1.3 Use of Estimates

The preparation of consolidated financial statements in conformity with Generally Accepted Accounting Principles (GAAP) in

India requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the

disclosure of contingent liabilities on the date of financial statements and the reported amount of revenue and expenses during the

reporting period. The management believes that the estimates used in preparation of the consolidated financial statements are

prudent and reasonable. Actual results could defer from these estimates. Difference between the actual results and estimates are

recognised in the period in which the results are known/ materialised.

1.4 Classification of Assets and Liabilities

Schedule III to the Companies Act, 2013 requires assets and liabilities to be classified as either Current or Non-current.

a) An asset is classified as current when it satisfies any of the following criteria:

(i) it is expected to be realised in, or is intended for sale or consumption in, the Group’s normal operating cycle;


(iii) it is expected to be realized within twelve months after the reporting date; or

(iv) it is cash or cash equivalent unless it is restricted from being exchanged or used to settle a liability for at least twelve

months after the reporting date.

b) All assets other than current assets are classified as non-current.

c) A liability is classified as current when it satisfies any of the following criteria:

(i) it is expected to be settled in the Group’s normal operating cycle;


(iii) it is due to be settled within twelve months after the reporting date; or

(iv) the Group does not have an unconditional right to defer settlement of the liability for at least twelve months after the

reporting date. Terms of a liability that could, at the option of the counterparty, result in its settlement by the issue

of equity instruments do not affect its classification.

d) All liabilities other than current liabilities are classified as non-current.

1.5 Operating Cycle

An operating cycle is the time between the acquisition of assets or inventories for processing and their realisation in cash or cash

equivalents. Based on the nature of their products/services, all the Group Companies have ascertained their operating cycle as

twelve months for the purpose of current or non-current classification of assets and liabilities.

1.6 Fixed Assets

a) Fixed assets are stated at their original cost of acquisition or construction except in case of certain assets which have been

revalued, at its revalued amount, less accumulated depreciation and impairment loss, if any. The cost of fixed assets

comprises of its purchase price including duties, taxes, freight and any other directly attributable cost of bringing the asset

to its working condition for its intended use. However, cost excludes Excise Duty, VAT & Service Tax, wherever credit of the

duty or tax is availed of.

b) All indirect expenses incurred on project implementation including interest cost on funds deployed for the project are treated

as incidental expenditure during construction and are capitalised for the period until the asset is ready for its intended use.

c) Fixed assets under construction and not ready for intended use, as on the balance sheet date, are disclosed as Capital Work-

in-Progress.

d) Considering the nature of business activity, Runway has been treated as Plant and Equipment and depreciation has been

provided accordingly.

e) Assets received on amalgamation are recorded at its fair value.

1.7 Depreciation

Parent Company

Depreciation is provided on Straight Line Method for Building, Plant and Equipment and Computer Hardware and on Written

Down Value Method on all other assets, based on useful life prescribed in Part C of Schedule II of the Companies Act, 2013. Based


59


on the technical evaluation which considered the nature and usage of the assets, the operating conditions of the assets, anticipated

technological changes and maintenance support etc., useful life of the following asset class is estimated to be higher than that

prescribed in the said Act:

Sr. No. Asset Class Useful life estimated by the Management

1. Plant and Equipment 15 - 48 Years

TAAL Tech India Private Limited (Subsidiary Company)

Depreciation on tangible assets is provided on Written Down Value Method. The rate has been calculated based on the remaining

useful life as per Schedule II of the Companies Act, 2013.

Intangible assets are amortised over a period of three financial years starting with the year in which these assets are procured.

1.8 Impairment of Assets

At each Balance Sheet date, an assessment is done to determine whether there is any impairment of the Group’s fixed assets based

on internal/ external factors. Where there is an indication that an asset is impaired, the recoverable amount if any, is estimated and

the impairment loss is recognised to the extent carrying amount of an asset exceeds its recoverable amount. Further, if at the Balance

Sheet date there is an indication that the previously assessed impairment loss no longer exist, the recoverable amount is reassessed

and the asset is reflected at recoverable amount subject to maximum of depreciable historical cost.

1.9 Inventories

a) Stock of raw materials, stores, spares, bought out items and certain components are valued at cost less amounts written

down.

b) Stock of certain aero structures, components, work in progress and finished goods are valued at lower of cost and net

realisable value based on technical estimate of percentage of work completed.

c) In determining the cost of raw materials, components, stores, spares and loose tools, the first in first out (FIFO) method is

used. Cost of inventory comprises all costs of purchase, duties, taxes (other than those subsequently recoverable from tax

authorities) and all other costs incurred in bringing the inventory to their present location and condition.

d) Cost of certain aero structures, work in progress and finished goods include material cost, labour costs and appropriate

factory overheads.

1.10 Investments

a) Investments that are readily realisable and intended to be held for not more than a year from the date of acquisition are

classified as current investments. All other investments are classified as non-current investments.

b) Current investments are stated at lower of cost and fair value determined on an individual investment basis.

c) Non-current investments are stated at cost. A provision for diminution in the value of non-current investments is made only

if such a decline is other than temporary in the opinion of the management. The determination for diminution is done

separately for each individual investment.

1.11 Trade Receivables

Trade receivables are stated after writing off debts considered as bad. Adequate provision is made for debts considered doubtful.

Bad Debts previously written off and recovered during the year is credited to the Consolidated Statement of Profit and Loss.

1.12 Aircraft Purchase Option

Aircraft purchase options are recorded at cost on the date of acquisition. Aircraft purchase option is amortised over its estimated

useful life of 120 months or the legal life, whichever is lower with a mid quarter convention.

1.13 Provisions, Contingent Liabilities and Contingent Assets

a) A provision is recognised when the Group has a present obligation as a result of past event and it is probable that an outflow

of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not

discounted to their present values and are determined based on management estimate required to settle the obligation at the

Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current management estimates.

b) Contingent liabilities are disclosed in respect of possible obligations that have arisen from past events and the existence of

which will be confirmed only by the occurance or non-occurance of future events not wholly within the control of the Group.

c) When there is an obligation in respect of which the likelyhood of outflow of resources is remote, no provision or disclosure

is made.


60


d) Contingent Assets are neither recognised nor disclosed in the consolidated financial statements.

1.14 Revenue Recognition

a) Revenue from long-term fixed price contracts to manufacture aero structures, spares, etc. is recognised under proportionate

completion method and the stage of completion for this purpose is determined based on technical estimate of actual work

completed.

b) Rental Income from Hanger Utilisation is accounted based on agreement/ contract entered into with the third party.

c) Charter Income from aircraft given on charter is booked on the basis of contracts with customers and actual flying hours of

the aircraft.

d) Training Fees received, being non-refundable, is accounted in the year of receipt.

e) Revenue from Engineering Design Services is priced on time and material basis and is recognised when the services are

rendered and related costs are incurred.

f) Revenue from long term fixed price contracts for supply of certain sets of components and assemblies is recognised on the

basis of proportionate completion method and billed in terms of agreement with and certification by the customer. Cost of

processing incurred on sets of components which are not billable is included in work in progress.

g) Revenue from sale of goods is recognised on transfer of all significant risks and rewards of ownership to the buyer. The

amounts recognised as sale is exclusive of Sales Tax/VAT and are net of returns.

h) Interest Income is recognised on time proportion basis taking into account the amount outstanding and the interest rate

applicable.

1.15 Leases

Operating Lease payments are recognised as an expense in the Consolidated Statement of Profit and Loss on a straight-line basis

over the lease term.

1.16 Borrowing Cost

Borrowing Costs directly attributable to the acquisition or construction of qualifying assets are capitalised as part of the cost of

the assets, upto the date the asset is ready for its intended use. All other borrowing costs are recognised as an expense in the

Consolidated Statement of Profit and Loss in the year in which they are incurred.

1.17 Foreign Currency Transactions

a) Initial Recognition: Transactions denominated in foreign currencies are recorded at the exchange rates prevailing on the date

of the transaction.

b) Conversion: At the year end, monetary items denominated in foreign currencies are converted into rupee equivalents at the

year-end exchange rates.

c) Exchange Differences: All exchange differences arising on settlement/conversion of foreign currency transactions are recognised

as income or expense in the Consolidated Statement of Profit and Loss in the year in which they arise.

d) Non monetary foreign currency items such as investments are carried at cost.

1.18 Employee Benefits

a) Defined Contribution Plan

The Parent Company and one of its Indian Subsidiary (TAAL Tech India Private Limited) make defined contribution to

Provident Fund and Superannuation Fund, which are recognised as an expense in the Consolidated Statement of Profit and

Loss on accrual basis.

b) Defined Benefit Plan

The Group’s liabilities under Payment of Gratuity Act and Long Term Compensated Absences are determined on the basis

of actuarial valuation made at the end of each financial year using the Projected Unit Credit Method, except for short term

compensated absences, which are provided on actual basis. Actuarial gains and losses are recognised immediately in the

Consolidated Statement of Profit and Loss as income or expense. Obligations are measured at the present value of estimated

future cash flows using a discounted rate that is determined by reference to market yields at the Balance Sheet date on

Government Bonds where the currency and terms of the Government Bonds are consistent with the currency and estimated

terms of the defined benefit obligation.


61

1.19 Provision for Taxation

Tax expense for the period, comprising Current Tax and Deferred Tax are included in the determination of the net profit or loss for

the year.

Current Tax is determined on the basis of taxable income and tax credits computed for each of the entities in the Group in

accordance with the provisions of applicable taxation laws of the respective jurisdiction where the entities are located.

Minimum Alternate Tax (MAT) paid in accordance with the tax laws, which gives future economic benefits in the form of

adjustment to future income tax liability, is considered as an asset. Accordingly, MAT is recognised as an asset in the Balance Sheet

when it is probable that future economic benefit associated with it will flow to the Group.

Deferred tax is recognised on timing differences, being the difference between the taxable income and the accounting income that

originate in one period and are capable of reversal in one or more subsequent periods. Deferred tax is measured using the tax rates

and the tax laws that have been enacted or substantively enacted as at the Balance Sheet date. Deferred tax assets in respect of

unabsorbed depreciation and carry forward of losses are recognised if there is virtual certainty that there will be sufficient future

taxable income available to realise such assets. Other deferred tax assets are recognised only to the extent there is a reasonable

certainty that the asset will be realised in future. Deferred tax assets are reviewed as at each Balance Sheet date to reassess

realisation. The deferred tax assets (net) and deferred tax liabilities (net) are determined separately for the Parent and each

Subsidiary Company, as per their applicable laws and then aggregated.

1.20 Segment Reporting

Segments are identified having regard to the dominant source and nature of risks and returns and internal organization and

management structure. The Group has considered business segments as the primary segments for disclosure. The business

segments are ‘Aviation’, ‘Charter Business’, ‘Trading of Electrical Goods’ and ‘Engineering Design Services’. The Group does not

have any geographical segment.

1.21 Contingencies and Events Occurring after the Date of Balance Sheet

a) Accounting for contingencies arising out of contractual obligation, are made only on the basis of mutual acceptances.

b) Material events occurring after the date of Balance Sheet up to the date of adoption of the accounts are considered in

preparation and presentation of the financial statements.

1.22 Earnings Per Share

The Basic and Diluted Earnings Per Share (“EPS”) is computed by dividing the net profit or loss after tax for the year attributable

to equity shareholders by weighted average number of equity shares outstanding during the year.



62


2. SHARE CAPITAL (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Authorised Capital

4,00,00,000 (Previous Year 4,00,00,000) 2,000.00 2,000.00

Equity Shares of Rs. 5/- each

10,00,000 (Previous Year 10,00,000) 500.00 500.00

15% Redeemable cumulative preference shares of Rs. 50/- each

2,500.00 2,500.00

Issued, Subscribed and Paid Up Capital

2,49,30,736 (Previous Year 2,49,30,736) 1,246.54 1,246.54

Equity Shares of Rs. 5/- each fully paid up

2.1 Reconciliation of the number of shares outstanding at the beginning and at the end of the year :


March 31, 2015 March 31, 2014

No. of Rs. No. of Rs.

shares in Lakhs shares in Lakhs

Equity Shares at the beginning of the year 2,49,30,736 1246.54 2,49,30,736 1246.54

Equity Shares issued during the year - - - -

Equity shares bought back during the year - - - -

Equity Shares outstanding at the end of the year 2,49,30,736 1246.54 2,49,30,736 1246.54

2.2 Details of shareholders holding more than 5% Equity Shares in the company

Name of the Shareholders As at As at

March 31, 2015 March 31, 2014

No. of % No. of %

shares holding shares holding

Indian Seamless Enterprises Limited 1,09,64,620 43.98 1,09,64,620 43.98

Vishkul Leather Garments Private Limited 16,89,179 6.78 16,89,179 6.78

2.3 Terms/Rights attached to Equity Shares

The Parent Company has only one class of equity share having par value of Rs. 5/- each. Each shareholder is entitled to one vote

per share. In the event of liquidation of the Company, the holders of equity shares will be entitled to receive any of the remaining

assets of the Company, after distribution of all preferential amounts, in proportion to their shareholding.

2.4 As at 31st March, 2015, the Parent Company has 15,000 Global Depository Receipt’s (GDR’s) outstanding for conversion into

Equity Shares (equivalent to 30,000 Equity Shares).


63


3. RESERVES AND SURPLUS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Capital Reserve

Balance as at the beginning of the year 5.80 5.80

Add: Reversal of Goodwill created on Acquisition of Associate 0.03 -

Balance as at the end of the year 5.83 5.80

Securities Premium Account


Add: Premium on Equity Shares issued by Subsidiary 50.06 -


General Reserve

Balance as at the beginning and as at the end of the year 1271.86 1271.86

Foreign Currency Translation Reserve


Add: Currency Translation Gain during the year 7.21 24.47


Surplus in Statement of Profit and Loss


Less: Depreciation adjustment consequent to revision in useful 46.89 -

lives [Refer Significant Accounting Policies Note No. 1.7

and Note No. 12]

Add: Net Profit/(Loss) after tax transferred from Statement of -772.96 -123.30

Profit and Loss

Less: Transferred to Minority Interest 17.21 -


8658.32 9438.09

4. LONG TERM BORROWINGS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Secured Loans:

Term Loan from Banks 3393.78 3077.87

Less: Current Maturities (Refer Note No. 10) 491.73 535.22

2902.05 2542.65

4.1 Maturity Profile of Secured Term loans from Banks (Rs. in Lakhs)

Particulars Maturity Profile

1-2 years 2-3 years 3-4 years Beyond 4 years

Term Loans 575.82 689.62 384.01 1252.60

4.2 Details of Securities and other terms:

The Term Loan from Bank outstanding as on 31st March, 2015 amounting to Rs. 0.15 Crores (including Current Maturities of LongTerm Borrowings) is secured by a first charge on assets created out of Term Loan – Building Rs. 4.60 Crores and Plant andEquipment Rs. 10.48 Crores of the Company and second charge on specific free hold lands to the extent of 26.87 acres andconstruction thereon of the Company at Belagondapalli Village, Thally Road, Denkanikottai Taluk, Krishnagiri District,Belagondapalli – 635114, Tamil Nadu.The Term Loan from Bank outstanding as on 31st March, 2015 amounting to Rs. 18.44 Crores (including Current Maturities ofLong Term Borrowings) is secured by a first charge on assignment of Hanger-1 rental/receivables from lessee and specific free holdlands to the extent of 36.93 acres of land and development thereon of the Company at Belagondapalli Village, Thally Road,Denkanikottai Taluk, Krishnagiri District, Belagondapalli – 635114, Tamil Nadu. Second Pari Passu Charge is created on other fixedassets (both movable and immovable) of the Company along with other consortium banks as collateral security.The Term Loan from Bank outstanding as on 31st March, 2015 amounting to Rs. 15.34 Crores (including Current Maturities ofLong Term Borrowings) is secured by a first charge on assignment of Hanger-2 rental/receivables from lessee and specific free holdlands to the extent of 37.11 acres of land and development thereon of the Company at Belagondapalli Village, Thally Road,Denkanikottai Taluk, Krishnagiri District, Belagondapalli – 635114, Tamil Nadu as collateral security.


64


5. DEFERRED TAX LIABILITIES (NET) (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Deferred Tax Liability: #

Difference in net book value of fixed assets as per - 581.97

books and tax laws

Deferred Tax Asset * 12.82 -

Net Deferred Tax Liability -12.82 581.97

# During the year, the Parent Company has written back their deferred tax liability amounting to Rs. 564.38 Lakhs.

* Pertains to Subsidiary TAAL Tech India Private Limited.

Deferred tax calculation of the Parent Company results into working of deferred tax assets as at 31st March, 2015. However as a

matter of prudence, the Parent Company has not recognised deferred tax asset.

6 OTHER LONG TERM LIABILITIES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Deposit from Lessee 845.28 845.28

Deposit from Customers 3.75 2.75

849.03 848.03

7. LONG TERM PROVISIONS (Rs. in Lakhs)


March 31, 2015 March 31, 2014


Gratuity 136.34 92.99

Leave Encashment 72.05 51.49

208.38 144.48

8. SHORT TERM BORROWINGS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Secured Loans:

Working Capital Borrowing from Banks 1469.56 1700.06

LC Payable for Capex 93.28 -

1562.84 1700.06

Unsecured Loans:

Loans and Advances from Related Party - 655.00

(Inter Corporate Deposit) (Refer Note No. 34)

- 655.00

1562.84 2355.06

8.1 Details of Securities and other terms

Working Capital Loan obtained by Parent Company from Banks amounting to Rs. 880.41 Lakhs is secured against hypothecation

of Stocks and Book Debts on pari-passu basis and second charge on Fixed Assets.

Working Capital Loan obtained by TAAL Tech India Private Limited from Bank amounting to Rs. 589.15 Lakhs alongwith LC

Payable for Capex amounting to Rs. 93.28 Lakhs is secured by equitable mortgage on the Freehold Land of Parent Company and

exclusive charge on the entire Fixed Assets of the Company (both Present and Future). Further, the Working Capital Loan and LC

obtained by TAAL Tech India Private Limited is guaranteed by the Parent Company.


65


9. TRADE PAYABLES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Micro, Small and Medium Enterprises * - -

Other Trade Payables 872.42 687.47

872.42 687.47

* As informed to us by the Management, the Company owes no dues which are outstanding as at 31st March, 2015 to any ‘Micro,

Small And Medium Enterprises’ as covered under “Micro, Small And Medium Enterprises Development Act 2006”. Dues to

Micro, Small and Medium Enterprises have been determined to the extent such parties have been identified on the basis of

intimation received from the “suppliers” regarding their status under the Micro, Small and Medium Enterprises Development Act,

2006.

10. OTHER CURRENT LIABILITIES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Current Maturities of Long Term Borrowings (Refer Note No. 4) 491.73 535.22

Advance from Customers 318.32 65.22

Statutory Liabilites * 181.28 247.06

Employee Related Liabilties # 395.02 150.32

Expenses Payable 158.36 49.04

Other Liabilities 44.65 194.44

1589.37 1241.30

* Includes payable towards TDS, Excise Duty, Service Tax, VAT and Employee Related Statutory Obligations.

# Including Rs. 57.78 Lakhs due to Whole Time Director’s (Previous Year Rs. 8.40 Lakhs).

11. SHORT TERM PROVISIONS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Provision For Audit Fees 14.96 8.87

Provision For Taxes * 196.74 153.61

Provision For Expenses # 104.56 35.91


Leave Encashment 2.02 -

Gratuity 0.83 -

319.11 198.39

* Includes Provision for Income Tax Rs. 194.19 Lakhs (Previous Year Rs. 153.61 Lakhs).

# Includes Provisions related to Travelling Expenses, Purchases, Onsite Expenses, Rent Escalation, etc.


66


12. FIXED ASSETS (Rs. in Lakhs)

GROSS BLOCK (AT COST) DEPRECIATION /AMORTISATION NET BLOCK

Description As at Additions Deduct As at As at For Deduct- Adjust As at As at As at

April 01, ions March 31, April 01, The ions ments* March 31, March 31, March 31,

2014 2015 2014 Year 2015 2015 2014

Tangible Assets:

Freehold Land $ 6274.80 # 649.35 - 6924.14 - - - - - 6924.14 6274.80

Buildings 2351.24 38.21 - 2389.45 490.51 64.39 - - 554.90 1834.55 1860.74

Plant and Equipment 6225.44 544.29 - 6769.73 2685.72 **256.60 - 1.99 2944.31 3825.42 3539.72

Office Equipment 192.88 1.02 - 193.90 124.41 17.90 - 42.00 184.31 9.59 68.46

Furniture and Fixtures 93.80 - - 93.80 81.55 3.55 - - 85.10 8.70 12.25

Computer - Hardware 142.24 21.99 - 164.24 47.97 81.37 - 1.25 130.59 33.65 94.27

Vehicles 41.14 4.01 - 45.15 29.99 4.21 - 1.66 35.85 9.30 11.15

Total (A) 15321.53 1258.87 - 16580.40 3460.15 428.01 - 46.89 3935.19 12645.21 11861.38

Intangible Assets:

Softwares 301.74 48.46 - 350.20 134.36 99.85 - - 234.20 116.00 167.38

Total (B) 301.74 48.46 - 350.20 134.36 99.85 - - 234.20 116.00 167.38

Total (A+B) 15623.27 1307.33 - 16930.60 3594.51 527.86 - 46.89 4169.39 12761.21 12028.76

Previous Year 14213.14 1410.13 - 15623.27 3130.23 464.28 - - 3594.51 12028.76 11082.91

CAPITAL WORK-IN-PROGRESS (AT COST) As at As at

March 31, 2015 March 31, 2014

(a) Building - 337.60

(b) Plant and Equipment - 138.58

(c) SEZ Unit ^ 195.23 -

Total 195.23 476.18

* As per Schedule II of the Companies Act, 2013 written down value of Fixed Assets whose lives have expired as at 1st April 2014 amounting to Rs. 46.89 Lakhs

have been adjusted against opening balance in Consolidated Statement of Profit and Loss. (Refer Note No. 3)

# Represents addition pursuant to acquisition of shares of Katra Auto Engineering Private Limited. (Refer Note No. 39)

$ The Gross Block of Freehold Land includes Rs. 4738.89 Lakhs (Previous Year Rs. 4738.89 Lakhs) on account of Revaluation.

** Had the Group continued with the previously assessed useful lives in respect of Plant and Equipment, charges for depreciation for the year would have been higher

by Rs. 64.54 Lakhs for assets held at 1st April, 2014.

^ Includes Pre-Operative Revenue Expenditure amounting to Rs. 44.63 Lakhs.

Pursuant to the enactment of the Companies Act, 2013, the Group has applied the estimated useful lives as specified in Schedule II, except in respect of certain assets

as disclosed in Significant Accounting Policy on Depreciation. [Refer Note No. 1.7]

The Company has capitalised the following expenses during the year to New Project, in accordance with the accounting policy consistently followed :

(Rs. In Lakhs)


March 31, 2015 March 31, 2014

a. Personnel Expenses

i) Managing Director’s Salary - 17.03

ii) Other Salary 1.85 24.03

b. Travelling Expenses 0.69 1.73

c. Interest - 55.16

d. Other Expenses 49.62 5.90

52.16 103.86

13. NON CURRENT INVESTMENTS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Unquoted, at cost fully paid up

Investment in Equity Shares

Associate Company

(i) TAAL Aerosystems Private Limited * 0.57 0.75

7,500 Shares (Previous Year 7,500) of Rs. 10/- each

Add: Share of post acquisition Reserves and Surplus - -0.13

Add: Share of current year loss - -0.05

Add: Reversal of Goodwill created on Acquisition of Associate 0.03 -

Less: Provision for Permanent Diminution 0.60 -

- 0.57

* TAAL Aerosystems Private Limited has applied for Dissolution on March 30, 2015. Hence, the same has been written off and the

Parent Company’s share in its loss for the year has not been considered in the Consolidated Financial Statements.


67

14. LONG TERM LOANS AND ADVANCES (Rs. in Lakhs)


March 31, 2015 March 31, 2014


Security Deposits 138.82 73.24

Capital Advance to Subsidiary (Refer Note No. 39) - 645.50

138.82 718.74

15. OTHER NON CURRENT ASSETS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Aircraft Purchase Option (Refer Note No. 33) 116.01 167.06

116.01 167.06

16. INVENTORIES (As taken, valued and certified by the Management) (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Raw Material and Components 183.24 126.75

Work-In-Progress 303.75 296.75

486.99 423.50

For mode of valuation of each class of inventories, Refer Note No.1.9

17 TRADE RECEIVABLES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Unsecured debts outstanding for a period exceeding six months

(i) Considered good 304.20 483.22

(ii) Considered doubtful 198.09 2.98

502.28 486.19

Less: Provision for doubtful debts 198.09 2.98

304.20 483.22

Other unsecured debts (considered good) 1311.78 1638.32

1615.98 2121.54



68


18. CASH AND BANK BALANCES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Cash and cash equivalents

Balance with banks in current accounts 374.13 344.21

Balance with banks in deposits (Less than 3 months maturity) 7.07 500.86

Cash on hand 1.14 3.34

Other bank balances

Margin money deposits with banks 203.15 189.78

(More than 3 months maturity)

585.49 1038.19

19. SHORT TERM LOANS AND ADVANCES (Rs. in Lakhs)


March 31, 2015 March 31, 2014


Inter Corporate Deposits 173.60 1103.41

MAT Credit Entitlement # 134.69 134.69

Advance Income Tax 586.52 740.63

Service Tax Input Credit 69.71 20.84

Loans and Advances to Related Parties (Refer Note No. 34) 931.20 34.36

Advance to Suppliers 87.95 75.81

Prepaid Expenses 75.07 55.54

Sundry Deposits 46.42 27.39

Advance to Employees 152.15 42.27

Other Receivables 8.29 15.82

2265.60 2250.76

# In the opinion of the management, based on the projected future taxable profits, the outstanding MAT Credit Entitlement of

Rs. 134.69 Lakhs as at March 31, 2015 will be utilized within the stipulated time period prescribed as per the provisions of

Income Tax Act, 1961. However, in case of inadequate profit, difference will be charged to respective years Statement of Profit and

Loss.

20. OTHER CURRENT ASSETS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Accrued Income 10.54 2.49

Aircraft Purchase Option (Refer Note No. 33) 58.01 55.69

Unamortised Preliminary Expenses 0.33 0.50

68.88 58.67


69


21. REVENUE FROM OPERATIONS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Sales – Aviation

Gross Domestic Sales 540.35 832.47

Less: Excise Duty 26.36 31.45

Net Domestic Sales 513.99 801.02

Export Sales 5.95 484.14

Services – Aviation

Domestic Conversion Charges 480.83 798.18

Export Conversion Charges 7.63 534.11

Charter Income * 717.16 794.47

Rental Services 1022.83 692.45

Training & Other Services 66.60 91.77

Engineering Design Services

Export Services 4972.24 3999.23

Domestic Services 7.02 32.15

7794.25 8227.52

* This does not include use of Aircraft for Testing & Training purposes and use by Management for Business Travel.

22. REVENUE FROM TRADING ACTIVITIES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Sale of Trading Goods (Refer Note No. 40) 346.34 -


353.27 -

23. OTHER INCOME (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Interest Income

From ICD’s 128.46 12.82

From Banks 17.54 24.98

From Others * 49.37 1.21

Miscellaneous Income # 29.79 14.81

Sundry Creditors Written Back 84.22 6.96

309.38 60.78

* Includes Interest on Income Tax Refunds of Rs. 47.66 Lakhs (Previous Year Rs. Nil).

# Includes Agriculture Income of Rs 12.41 Lakhs (Previous Year Rs. 12.35 Lakhs).

24. COST OF MATERIAL CONSUMED (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Opening Stock of Raw Material and Components 126.75 232.39

Add: Purchases during the year 607.46 1431.89

Less: Closing Stock of Raw Material and Components 183.24 126.75

Consumption of Raw Material and Components 550.97 1537.53


70


24.1 Value of Raw Materials and Components consumed during the Year

Particulars Percentage (%) Value (Rs. in Lakhs)



Imported * 19.04 37.14 104.92 571.11

Indigenous 80.96 62.86 446.05 966.42

100 100 550.97 1537.53

* The imported raw material and components are presumed to be consumed during the year of purchase.

24.2 CIF Value of Imports of Raw Material, Spares, etc. for the year (Rs. in Lakhs) 104.92 571.11

25. CHANGES IN INVENTORY OF WORK-IN-PROGRESS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Closing Stock of Work-In-Progress 303.75 296.75

303.75 296.75

Opening Stock of Work-In-Progress 296.75 344.25

296.75 344.25

(Increase) / Decrease in Inventory (7.00) 47.51

26. OPERATIONAL AND OTHER EXPENSES (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Charter Expenses:

Aircraft Fuel Charges 139.30 152.50

Aircraft Lease Rent ^ 399.71 344.14

Aircraft Repairs and Maintenance 240.02 50.93

Rent - Flight Parking & Equipment 23.16 15.84

Other Aircraft Operating Expenses 95.13 75.85

Amortisation of Aircraft Purchase Option 56.64 53.05

Power & Fuel Expenses 131.23 112.64

Hardware and Software Hire & Maintenance Charges 84.00 48.09

Repairs and Maintenance Plant & Equipment 31.87 15.55

Repairs and Maintenance Building 1.49 11.86

Repairs and Maintenance Others 22.23 61.77

Selling Expenses 65.91 85.54

Rent 147.04 103.22

Educational Program Expenses 1.81 1.93

Rates & Taxes 66.20 22.00

Insurance 45.61 28.42

Traveling & Conveyance 710.11 512.63

Communication Expenses 61.18 44.98

Provision for Bad Debts 195.11 -

Directors’ Sitting Fees 6.93 3.90

Office & Other Administrative Expenses * 186.82 232.67

Legal, Professional & Consultancy Charges 234.59 112.45

Bad Debts Written Off 166.78 47.33

Exchange Fluctuation Loss / (Gain) [Net] 35.51 -38.73

(Other than considered as Finance Cost)

Preliminary Expenses Written Off 0.17 0.17

Auditors Remuneration # 16.38 9.47

3164.92 2108.20

^ Aircraft Lease Rent

During the year 2007-08, Company acquired an Aircraft on operating lease from an overseas lease finance company for a period

of 120 months.


71

The payments under lease for the future period are:

Particulars Amount in Equivalent in

US $ Rs. In Lakhs

Less than One Year 4.85 303.55

More than 1 Year and less than 5 Years 8.92 558.22

13.77 861.77

Note : In addition to the future fixed lease rentals mentioned above, variable component linked to LIBOR plus 2.50% p.a. is also payable

on monthly basis.

* Includes Printing & Stationery Expenses, Security Charges, Agriculture Expenses, Visa and Work Permit Expenses & Miscellaneous

Expenses.

(Rs. in Lakhs)

# Auditors Remuneration : Year ended Year ended

March 31, 2015 March 31, 2014

Audit Fees 12.52 6.19

Tax Audit Fees 2.00 1.75

Fees for Other Services 1.50 1.05

Out of Pocket Expenses/Travelling 0.36 0.23

Cost Audit Fees - 0.25

16.38 9.47

27. EMPLOYEE BENEFITS EXPENSE (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Salaries, Wages and Bonus 4104.17 3457.99

Contribution to Provident and Other Funds (Refer Note No. 35) 179.62 81.35

Staff Welfare Expenses 108.52 113.81

4392.30 3653.15

28. FINANCE COSTS (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Interest Expenses:

Working Capital Loan 187.81 169.17

Term Loans 387.36 233.97

Inter Corporate Deposits (Refer Note No. 34) 48.90 115.21

624.07 518.34

Less: Capitalised during the Year - 55.16

624.07 463.18

Other Finance Costs # 129.99 94.99

754.05 558.17

# Includes Interest on Delayed Payment of Statutory Liabilities amounting to Rs. 43.07 Lakhs (Previous Year Rs. 10.20 Lakhs).



72

29. A) Contingent Liabilities (to the extent not provided for) : (Rs. in Lakhs)


March 31, 2015 March 31, 2014

(a) Claims against the Group not acknowledged as debts:

(i) Custom Duty 622.67 622.67

(ii) Service Tax 441.37 441.37

(iii) Excise Duty 161.47 103.97

(iv) Sales Tax 55.00 78.00

(v) Income Tax 22.74 -

Future Cash Outflows in respect of the above, if any, is determined only on receipt of judgement/decisions pending with relevant

authorities. The Group does not expect the outcome of matters stated above to have a material adverse effect on the Group’s

financial condition, result of operations or cash flows.

(b) In addition, the Group is subject to other legal proceedings in respect of other matters arisen in the ordinary course of business.

The management is of the opinion that the ultimate liability in respect of these litigations shall not have any material adverse effect

on the Group’s operation and financial position.

B) Capital and Other Commitments (to the extent not provided for) : (Rs. in Lakhs)


March 31, 2015 March 31, 2014

(a) Capital Commitment towards the new project - 83.00

(b) Letters of Credit 291.60 -

(c) Bank Guarantees 1198.71 1097.56

(d) Indemnity issued to customers 229.80 918.80

(e) EPCG Export sales obligation to be fulfilled 681.70 660.70

(f) Guarantee given to bank by Parent on behalf of Subsidiary 760.00 -

30 Earnings Per Equity Share: (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Loss after tax available for Equity Shareholders (772.96) (123.30)

Adjusted Weighted Average number of Equity Shares of nominal value 2,49,30,376 2,49,30,376

of Rs. 5 each

Computation of EPS - Basic* (in Rs.) (3.10) (0.49)

*Diluted EPS is same as Basic EPS, as there are no outstanding potential equity shares as on date.

31 Earnings in Foreign Currency (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Export of Goods 5.95 484.14

Export of Services 4979.87 4530.71

Other Receipts 2.34 -

4988.17 5014.85



73

32 Expenditure in Foreign Currency (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Parts and Components 117.60 615.34

Travelling Expenses 103.16 236.39

Aircraft Repairs and Maintenance 237.70 -

Work Permit Fees 63.07 108.16

Aircraft Lease Rent 399.71 307.98

Onsite Expenses 1681.80 1306.23

Subscription Fees 9.37 139.06

Labour Charges - 9.15

Sales Commission - 8.20

Other 31.39 0.08

2643.78 2730.59

Note: Does not include expenditure incurred by foreign subsidiaries in the currency of their country of incorporation.

33 Aircraft Purchase Option

In December 2007 First Airways Inc. (a wholly owned subsidiary of TAAL) purchased an “Aircraft Purchase Option” vide option

agreement (“agreement”) for Cessna Aircraft 525A; Serial Number 525A - 0373 from Cessna Finance Corporation (CFC). The said

aircraft is leased to TAAL (the Parent Company) vide aircraft lease No 01-0043297-0010559 -01 (“Aircraft Lease”) dated

December 11, 2007, for a term of 120 months.

As per the agreement, First Airways Inc. has an option to purchase the Cessna Aircraft subject to aircraft lease on any monthly

lease rental payment date or on the last day of the term of the lease. In the event this option is exercised, First Airways Inc. shall,

on or before the date of purchase, pay CFC the Stipulated Loss Value of the aircraft plus all other sums then due under the aircraft

lease or under any other agreements, which will be considered as the “Purchase Option Price”.

As per the agreement, the Stipulated Loss Value at the end of 120 month lease term is US $ 12,79,929. First Airways Inc. is

estimating use of the Aircraft Purchase Option at the end of the 120 month lease term with mid-quarter convention. The Aircraft

was put to use on February 20, 2008. The same has been disclosed in its balance sheet as follows:


US $ in Lakhs Rs. In Lakhs US $ in Lakhs Rs. In Lakhs

Aircraft Purchase Option 9.27 580.05 9.27 556.88

Less: Accumulated Amortization -7.41 -464.04 -6.49 -389.81

Aircraft Purchase Option - Non Current Portion 1.85 116.01 2.78 167.06

Add: Aircraft Purchase Option - Current Portion 0.93 58.01 0.93 55.69

Aircraft Purchase Option 2.78 174.01 3.71 222.75

Since, the payment for Aircraft Purchase Option is a sunk cost and non refundable irrespective of whether the option is exercised

or not, in preparation of consolidated financial statements of TAAL, the entire payment of around Rs. 1,74,01,432 (US $ 2,78,019)

for Aircraft Purchase Option (Current as well as Non Current Portion) has been considered as “Deferred Revenue Expenditure” to

be written off over the remaining lease period.

Further, based on the legal opinion obtained by the Parent Company, the lease transaction has been accounted by the Parent

Company as an “Operating Lease”. The monthly operating lease payments are recognised as an expense in the Statement of Profit

and Loss on a straight line basis over the lease term. The same is grouped under the head of ‘Charter Expenses’.



74

34 Disclosure in respect of Related Parties pursuant to Accounting Standard 18

Relationship Name of the Related Party

a. Associate Companies ISMT Limited

LightO Technologies Private Limited

Indian Seamless Enterprises Limited

TAAL Aerosystems Private Limited ^

b. Key Management Personnel Mr. Salil Taneja (Whole Time Director of Parent Company) $

Mr. S M Kapoor (Managing Director of Parent Company) %

Mr. C S Kameswaran (Non Executive Director of Parent Company) ^^

Mr. Prakash Saralaya (Whole Time Director of TAAL Tech India Private

Limited)

^ Applied for Dissolution on March 30th, 2015.

$ Appointed as a Whole Time Director w.e.f. December 1st, 2014 for a period of two years upto November 30th, 2016.

% Appointed as a Managing Director w.e.f. December 1st, 2014 for a period of two years upto November 30th, 2016. The said

Managing Director resigned on April 1st, 2015.

^^ Managing Director upto November 30th, 2014. Non Executive Director from December 1st, 2014.

Transactions/ Balances with Related Parties: (Rs. in Lakhs)

Particulars Associates Key Management

Personnel

Investment in Equity of Subsidiary Company - 65.06

(-) (-)

Inter-Corporate Deposit Received during the year 2216.81 -

(656.42) (-)

Inter-Corporate Deposit Given during the year 1410.15 -

(60.00) (-)

Aircraft Hiring Charges - -

(240.00) (-)

Sale of Trading Goods 346.34 -

(-) (-)


(-) (-)

Sale of Goods 42.53 -

(20.40) (-)

Directors’ Sitting Fees - 0.40

(-) (0.40)

Interest Paid 46.38 -

(115.21) (-)

Interest Income 22.77 -

(-) (-)

Loan Received during the year - -

(-) (15.00)

Managerial Remuneration # - 172.43

(-) (85.52)

Remuneration to Non Executive Director # - 3.00

(-) (-)

Balance Payable as at year end - 57.78

(843.51) (8.40)

Balance Receivable as at year end 1187.51 -

(34.36) (-)

(Figures in brackets relate to previous year)



75

# Excludes contribution to Gratuity Fund and Provision for Leave Encashment as separate figures are not ascertainable for the

Managerial Personnel.

Note: No amounts pertaining to related parties have been provided for as doubtful debts. Also, no amounts have been written off or

written back during the year.

35 The Accounting Standard 15 (Revised 2005) on “Employee Benefits” has been adopted by TAAL (Parent Company) and its

subsidiary ‘TAAL Tech India Private Limited’.

a. Defined Contribution Plan :

The Group has recognized the following amount as an expense and included under the head “ Personnel Cost”:

(Rs. in Lakhs)


March 31, 2015 March 31, 2014

Employer’s Contribution to Provident Fund, Family Pension Fund and 111.33 90.38

Other Funds

b. Defined Benefit Plan as per Actuarial Valuation:

I. Changes in present value of Defined Benefit Obligations: (Rs. in Lakhs)


March 31, 2015 March 31, 2014

Gratuity (Funded)







Present Value of Obligations as at 31st March, 2015 (31st March,2014) 141.53 106.26

Leave Encashment (Non Funded)







Present Value of Obligations as at 31st March, 2015 (31st March, 2014) 74.07 51.49

II. Changes in fair value of plan assets: The Group has not made any investment in plan assets and therefore, there are

no changes in fair value and returns thereon.

III. Amounts recognized in the Balance Sheet in respect of: (Rs. in Lakhs)


(Non Funded)



Present Value of Obligation as at 31st March, 2015 141.53 106.26 74.07 51.49

(31st March, 2014)

Less: Funded with LIC 4.36 13.27 - -

Net Liability 137.17 92.99 74.07 51.49



76


IV. Expenses recognised in the Statement of Profit & Loss (under the head “Personnel Cost”): (Rs. in Lakhs)


(Non Funded)



Current Service Cost 29.80 19.18 22.25 14.50

Interest Cost 9.01 7.46 9.73 3.35

Past Service Cost - - - -

Actuarial (Gain)/Loss 13.07 -11.03 0.86 -1.95

Expenses recognised in the Statement of Profit and Loss 51.88 15.61 32.83 15.89

V. Principal Actuarial Assumptions used as at the Balance Sheet date:


(Non Funded)



Discount Rate 7.80% 8.20% 7.80% - 9.20% 8.20% - 9.20%

Salary Escalation Rate 5%-10% 8.00% - 12.46% 5%-10% 8.00% - 12.46%

Discount Rate: The discount rate is based on the prevailing market yields of Indian Government Securities as at the Balance Sheet date

for the estimated term of the obligations.

Salary Escalation Rate: The estimates of future salary increases, considered in acturial valuation, takes into account the inflation,

seniority, promotion and other relevant factors such as supply and demand in the employment market.

36 Segment Reporting (Rs. in Lakhs)


Business * Electrical Des ign 2014-15 Service 2013-14

Goods ^ Service

a. Segment Revenue

Segmental Revenue from :

External Sales and Services 2097.82 717.16 353.27 4979.26 8147.51 4196.14 4031.38 8227.52

Unallocable Revenue 309.38 60.79

Total Revenue 2097.82 717.16 353.27 4979.26 8456.90 4196.14 4031.38 8288.31

b. Segment Result

Operating Profit/(Loss) -634.18 -392.98 6.93 192.37 -827.87 30.23 386.62 416.85

Add: Unallocable Revenue 309.38 60.79

Less: Finance Costs 754.05 558.17

Less: Extraordinary Items 17.40 2.46

Loss before Tax -1289.94 -83.00

Less: Tax (Benefit)/ Expense 39.86 40.26

Add: Deferred Tax Liability 564.38 -

Written Back

Loss after Tax -765.42 -123.26

c. Other Information

Segment Assets 13107.31 919.00 265.11 1907.34 16198.76 15194.41 1342.07 16536.48

Unallocable Assets 2036.23 2747.50

Total Assets 18234.99 19283.98

Segment Liabilities 1920.95 194.98 276.51 790.91 3183.35 1775.89 466.44 2242.33

Unallocable Liabilities 5146.79 6357.02

Total Liabilities 8330.14 8599.35

Capital Employed 9904.85 10684.62

d. Cost Incurred for Acquiring

Assets 1239.33 0.31 - 67.69 1307.33 1211.25 198.89 1410.13

Segment Depreciation 341.32 4.61 - 181.92 527.86 342.12 122.16 464.28


77

Notes to Consolidated Financial Statement for the year ended March 31, 2015(Contd.)

* The Group has identified Charter Business as its business segment w.e.f. the current financial year. Hence, comparative figures for

the previous period for Charter Business is not reported.

^ Trading of Electrical Goods represents new business started by the Parent Company during the year (Refer Note No. 40). Hence,

comparative figures for the previous period for Trading of Electrical Goods is not reported.

As per Accounting Standard 17, the Group has four segments viz “Aviation, Charter Business, Trading of Electrical Goods and

Engineering Design Service”.

(i) Revenue and Expenses have been identified to a segment on the basis of relationship to operating activities of the segment. Revenue

and Expenses which relate to Enterprise as a whole and are not allocable to a segment on reasonable basis have been disclosed as

unallocable.

(ii) Segment Assets and Segment Liabilities represent Assets and Liabilities in respective Segments. Investments, Tax Related Assets

and Other Assets and Liabilities which cannot be allocated to a segment on a reasonable basis have been included under Unallocable

Assets and Liabilities.

37 The Group does not enter into any forward foreign exchange contracts.

Foreign currency exposure not hedged as at March 31, 2015 are as under:


(in Lakhs) (in Lakhs)

Foreign INR Foreign INR

Currency Currency

Expenses Payable

USD 0.64 39.79 0.56 33.37

EUR 0.40 30.46 0.60 49.88

NOK - - 0.01 0.10

Lease Rent Payable

USD 1.29 80.66 1.72 103.10

150.91 186.45

Receivable (Trade & Non-Trade)

USD 11.03 686.60 10.22 614.03

EUR 2.13 143.96 1.36 111.97

NOK 9.61 79.38 19.19 192.83

CAD - - 0.11 5.89

909.95 924.72

38 The Board of Directors of the Parent Company have in their meeting held on October 9, 2014, approved the Scheme of Arrangement

(“Scheme”) under the Companies Act, 1956/ 2013 between Taneja Aerospace and Aviation Limited (‘TAAL’) and its wholly

owned subsidiary TAAL Enterprises Limited (‘TEL’), where the Charter Business including investment in First Airways Inc,

USA (Wholly Owned Subsidiary) and Engineering Design Services Business conducted through TAAL Tech India Private Limited

(Subsidiary) would be demerged into TEL with appointed date as October 1, 2014. The excess of book value of assets over the

book value of liabilities to be transferred will be adjusted against Securities Premium Account (amounting to Reduction in Share

Capital) as approved by the shareholders at the Extra Ordinary General Meeting held on April 15, 2015.

Pursuant to the Demerger, shareholders of the Parent Company will get 1 fully paid up Equity Share of Rs. 10 each of TEL for

every 8 fully paid up Equity Share of Rs. 5 each held in the Parent Company.

After clearance of the draft Scheme by the shareholders and various regulatory authorities, the Parent Company’s petition was

admitted by the Hon’ble Madras High Court on April 29, 2015 and order sanctioning the Scheme has been received on July 23,

2015.

Effect of the Scheme will be given upon filing the aforesaid copy of the Scheme to the concerned Registrar of Companies and the

Scheme becoming effective (Effective Date).


78


In accordance with Accounting Standard 24, “Discontinuing Operations”, the financial results of the Air Charter Business and

Engineering Design Services Business (discontinuing operations) from consolidated results perspective are as under:

(As prepared and certified by the Management) (Rs. in Lakhs)

Particulars Year ended March 31, 2015 Year ended March 31, 2014

Air Engg. Total Air Engg. Total

Charter Design Charter Design

a) Statement of Profit and Loss

Revenue from Operations 713.26 4,979.26 5,692.53 802.58 4,031.38 4,833.97

Other Income 3.37 48.32 51.70 3.51 41.87 45.38

Total Revenue 716.64 5,027.59 5,744.22 806.09 4,073.26 4,879.35

Cost of Material Consumed 28.27 - 28.27 2.47 - 2.47

Employee Benefits Expense 94.00 3,299.95 3,393.95 82.38 2,566.51 2,648.89

Finance Costs 10.97 59.60 70.57 4.02 32.37 36.39

Depreciation & Amortisation 4.61 181.92 186.54 8.19 122.16 130.36

Other Expenses 983.26 1,305.03 2,288.29 730.68 998.93 1,729.61

Total Expenses 1121.11 4,846.50 5,967.61 827.74 3,719.97 4,547.71

(Loss) / Profit from Discontinuing Operations -404.48 181.09 -223.39 -21.65 353.28 331.63

before Extraordinary Items and Tax

Less : - Prior Period Items - 7.85 7.85 - - -

(Loss) / Profit from Discontinuing Operations -404.48 173.24 -231.24 -21.65 353.28 331.63

before Tax

Less : - Tax Expenses 2.60 28.95 31.55 2.43 37.82 40.26

Net (Loss) / Profit from Discontinuing -407.07 144.29 -262.79 -24.08 315.46 291.38

Operations after Tax

b) Carrying amount of Assets and Liabilities 942.38 2129.55 3071.93 1324.30 1343.88 2668.19

Carrying amount of assets as at the balance sheet

date relating to discontinuing business to be

disposed off

Carrying amount of liabilities as at the balance 194.69 1,463.08 1657.78 176.06 502.95 679.01


to be settled

c) Net Cash Flow Attributable to

the ‘Discontinuing Operations’:

Cash flow from Operating activities 5.27 -300.93 -295.65 -61.82 268.03 206.21

Cash flow from Investing activities 0.08 -225.26 -225.18 55.95 -198.68 -142.73

Cash flow from Financing activities -10.97 704.76 693.80 -4.02 -15.20 -19.22

Net Cash Inflow / (Outflow) -5.61 178.57 172.96 -9.89 54.15 44.26

39 Katra Auto Engineering Private Limted purchased land for the Parent Company amounting to Rs. 649.35 Lakhs, out of interest free

advance of Rs. 646 Lakhs (Upto Previous Year Rs. 645.50 Lakhs) provided by the Parent Company. As on 11th June, 2014, Katra

Auto Engineering Private Limited has become 100% Subsidiary of the Company and has therefore been considered in the consolidated

financial statements. The pre-acquisition losses of Katra Auto Engineering Private Limited has been accounted as Goodwill on

Consolidation.

40 In line with the objects of the Parent Company and as approved by the Board, the Parent Company has started during the current

year trading in electrical goods.


79









41 Disclosure of additional information, as required under schedule III to the Companies Act, 2013 pertaining to the Parent Company

and Subsidiaries:

(Rs. In Lakhs)

Name of the Company Net Assets (Total Assets Share in Profit or Loss

minus Total Liabilities)

As % of Net Assets As % of Profit/ (Loss)

Consolidated Consolidated

Net Assets Profit or Loss

Parent Company

Taneja Aerospace and Aviation Limited 95.42 9489.29 98.36 -752.87

Indian Subsidiaries

Direct Subsidiaries

TAAL Tech India Private Limited 2.07 205.81 -4.10 31.38

Katra Auto Engineering Private Limited 0.04 4.14 0.11 -0.81

TAAL Enterprises Limited 0.04 4.14 0.11 -0.86

Foreign Subsidiaries

Direct Subsidiaries

First Airways Inc 1.83 181.96 7.99 -61.17

Indirect Subsidiaries

TAAL Technologies Inc 0.43 42.35 -2.47 18.19

TAAL Tech GMBH 0.17 16.88 - -

TOTAL 100 9944.61 100 -765.42

Note: The above figures are stated at gross values after eliminating investment in subsidiaries but without eliminating intra group

transactions and intra group balances as at 31st March, 2015.

42 The shareholders of the Parent Company had by way of postal ballot passed a resolution dated 5th August, 2013 approving the

transfer of Assets and Liabilities of the Company’s Engineering Design Services Division to its Subsidiary ‘TAAL Tech India

Private Limted’, with effect from 1st August, 2013. Accordingly, related Assets and Liabilities were transferred at their book

values.

43 The audited/unaudited financial statements of foreign subsidiaries have been prepared in accordance with the Generally Accepted

Accounting Principle of its country of incorporation or International Financial Reporting Standards. The differences in accounting

policies of the Parent Company and its subsidiaries/associates are not material.

44 The balances in Debtors and Creditors accounts are subject to confirmations and reconciliations if any.

45 Current Assets, Loans and Advances are of the value stated if realised in the ordinary course of business.

46 In the Opinion of the Board, adequate steps are taken to make sufficient provision for all liabilities.

47 Previous year figures have been regrouped and reclassified wherever necessary to conform to the current year classification.



80

Part “B”: Associates and Joint Ventures

Statement pursuant to Section 129(3) of the Companies Act, 2013 related to Associate Companies

(Rs. in Lakhs)

Name of Associate company TAAL Aerosystems Pvt. Ltd.

1. Latest audited Balance Sheet Date 31.03.2014

2. Shares of Associate held by the Company on the year end-

No. 7,500

Amount of Investment in Associate 0.75

Extend of Holding % 30%

3. Description of how there is significant influence Holding more than 20% of its share capital

4. Reason why the associate is not consolidated TAAL Aerosystems Pvt. Ltd. had applied for dissolution on March 30, 2015 & ceased to

be an Associate Company effective April 7, 2015

5. Networth attributable to Shareholding as per 0.58

latest audited Balance Sheet

6. Profit/ Loss for the year-

i. Considered in Consolidation -

ii. Not Considered in Consolidation TAAL Aerosystems Pvt. Ltd. had applied for dissolution on March 30, 2015 & ceased to

be an Associate Company effective April 7, 2015

1. Names of associate which has yet to commence operations. TAAL Aerosystems Pvt. Ltd.

2. Names of associate which have been liquidated or Nil

sold during the year.

AOC-1(Pursuant to first proviso to sub-section (3) of section 129 read with rule 5 of Companies (Accounts) Rules, 2014)

Statement containing salient features of the financial statement of subsidiaries/ associate companies

PART “A”: SUBSIDIARIES

(Rs. in Lakhs)

Sr. Name of Reporting Share Reserves Total Total Investments Turnover Profit Provision Profit Proposed % of

No. Subsidiary Currency Capital & Assets Liabilities Before for After Dividend Shareholding

in case of Surplus Taxation Taxation Taxation *

foreign

subsidiaries

1 TAAL Tech India Pvt. Ltd. - 100.00 144.02 2105.90 1861.88 38.22 5027.58 54.77 23.40 31.38 NIL 85%

2 TAAL Technologies Inc. US $^ 18.88 23.47 77.25 34.91 0.00 326.65 24.47 5.56 18.91 100%

3 Katra Auto Engineering Pvt. Ltd. - 5.00 (1.59) 649.54 646.13 0.00 0.00 (0.81) 0.00 (0.81) 100%

4 TAAL Enterprises Ltd. - 5.00 (0.86) 4.19 0.06 0.00 0.00 (0.86) 0.00 (0.86) 100%

5 First Airways Inc. US $^ 477.50 (295.53) 181.96 0.00 0.00 0.00 (58.57) 2.60 (61.17) 100%

* Representing Aggregate % of shares held by the Company and/ or its subsidiaries.

^ Exchange rate as on March 31, 2015: 1US $ = Rs.62.5908.

Notes:

A Name of Subsidiaries which are yet to commence operations-

Sr. No. Name of Subsidiary Company

1 TAAL Enterprises Ltd.

2 Katra Auto Engineering Pvt. Ltd.

B Name of Subsidiaries which have been liquidated or sold during the year - Nil


1

NOTICE is hereby given that the 26 th Annual General

Meeting of the Members of Taneja Aerospace and Aviation

Limited will be held on Wednesday, September 30, 2015 at

2.00 p.m. at the Registered Office of the Company at

Belagondapalli Village, Thally Road, Denkanikottai Taluk,

Krishnagiri District, Belagondapalli-635114, Tamil Nadu to

transact the following business:

Ordinary Business:

1. To receive, consider and adopt :

(a) the Audited Financial Statements of the Company

for the Financial Year ended March 31, 2015

including the Audited Balance Sheet as at March

31, 2015 and the Statement of Profit and Loss for

the year ended on that date and the Reports of the

Board of Directors and the Auditors thereon; and

(b) the Audited Consolidated Financial Statements of

the Company for the Financial Year ended March

31, 2015 including the Audited Consolidated

Balance Sheet as at March 31, 2015 and the

Consolidated Statement of Profit and Loss for the

year ended on that date and the Report of the

Auditors thereon.

2. To appoint a Director in place of Mr. C. S. Kameswaran

(DIN: 00553423), who retires by rotation and being

eligible, offers himself for re-appointment.

3. To appoint Auditors and fix their remuneration and in

this regard, to consider and if thought fit, to pass, with

or without modification(s), the following resolution as

an Ordinary Resolution :

“RESOLVED THAT pursuant to the provisions of

Section 139, 140 and other applicable provisions of the

Companies Act, 2013 and the Rules made thereunder,

M/s MZSK & Associates, Chartered Accountants (Firm

Registration No. 105047W) be and are hereby appointed

as Statutory Auditors of the Company, in place of

M/s. Haresh Upendra & Co., the retiring Statutory

Auditors, to hold office for a period of 1 (One) year from

the conclusion of this Annual General Meeting until the

conclusion of next Annual General Meeting, on such

remuneration as shall be fixed by the Board of Directors,

plus service tax and such other tax(es), as may be

applicable and reimbursement of all out-of-pocket

expenses in connection with the audit of the accounts

of the Company.”

NOTICE

Special Business:

4. To consider and if thought fit, to pass, with or without

modification(s), the following Resolution as an Ordinary

Resolution:

“RESOLVED THAT pursuant to Section 149, 152 and

other applicable provisions, if any, of the Companies

Act, 2013 (‘the Act’) and Rules made thereunder, Mrs.

Preeti Taneja (DIN: 07225304) who was appointed as an

Additional Director of the Company by the Board of

Directors with effect from August 14, 2015 and who holds

office up to the date of this Annual General Meeting in

terms of Section 161(1) of the Act and in respect of whom

the Company has received a notice in writing from a

Member under Section 160 of the Act proposing her

candidature for the office of Director, be and is hereby

appointed as a Non Executive Director (Non

Independent) of the Company liable to retire by rotation.”

5. To consider and if thought fit, to pass, with or without

modification(s), the following resolution as an Ordinary

Resolution:

“RESOLVED THAT pursuant to Section 149, 152 and

other applicable provisions, if any of the Companies

Act, 2013 (‘the Act’) and Rules made thereunder read

with Schedule IV to the Act, (including any statutory

modification(s) or re-enactment thereof for the time being

in force) Mr. R. Surie (DIN: 01081973), a Director of the

Company who has submitted a declaration that he meets

the criteria for independence as provided in Section

149(6) of the Act and who is eligible for appointment, be

and is hereby appointed as an Independent Director of

the Company, to hold office until the conclusion of

27th Annual General Meeting of the Company and that

he shall not be liable to retire by rotation.”

By Order of the Board of Directors

Chetan Nathani

Pune, September 1, 2015 Company Secretary

Registered Office:


Krishnagiri District, Belagondapalli – 635 114, Tamil Nadu

Taneja Aerospace and Aviation LimitedRegd. Office: Belagondapalli Village, Thally Road, Denkanikottai Taluk, Krishnagiri Dist.,

Belagondapalli – 635114, Tamil Nadu. Phone: 04347- 233508, Fax : 04347-233414,

E-mail: [email protected], Web: www.taal.co.in

CIN: L62200TZ1988PLC014460

2

NOTES :

1. The information required to be provided under the Listing

Agreement entered with the Stock Exchange, regarding the

Directors who are proposed to be appointed, re-appointed

and the relative Explanatory Statement and reasons for the

proposed Special Business stated pursuant to Section 102 of

the Companies Act, 2013 (Act) are annexed.

2. A Member entitled to attend and vote at the Meeting may

appoint a proxy to attend and vote on a poll on his behalf. A

proxy need not be a Member of the Company. A person can

act as proxy on behalf of Members not exceeding 50 and

holding in the aggregate not more than 10% of the total Share

Capital of the Company. A Member holding more than 10%

of the total Share Capital of the Company may appoint a

single person as proxy and such person shall not act as proxy

for any other person or Member. The instrument appointing

proxy should, however, be deposited at the Registered Office

of the Company not less than 48 hours before the

commencement of the Meeting.

3. Corporate Members are requested to send a duly certified

copy of the Board Resolution authorizing their representatives

to attend and vote at the Meeting.

4. The Register of Members and Share Transfer Book of the

Company will remain closed on September 30, 2015.

5. The Annual Report for FY 2014-‘15 and Notice of Annual

General Meeting (AGM) of the Company inter alia indicating

the process and manner of voting along with Attendance Slip

and Proxy Form is being sent to all the members whose email

IDs are registered with the Company/Depository

Participants(s) for communication purposes unless any

member has requested for a hard copy of the same. For

members who have not registered their email address, physical

copies of the aforesaid Annual Report and Notice of the AGM

etc. is being sent by the permitted mode.

Members may also note that the aforesaid Notice of AGM

and the Annual Report will also be available for download on

the Company’s website www.taal.co.in.

6. In compliance with the provisions of Section 108 of the Act,

read with Rules made thereunder and Clause 35B of the Listing

Agreement, the Company is pleased to provide to its members

facility to exercise their right to vote on resolutions proposed

to be considered at the ensuing AGM by electronic means and

the business may be transacted through electronic voting. The

facility of casting the votes by the Members using an electronic

voting system from a place other than venue of the AGM

(“remote e-voting”) will be provided by Central Depository

Services (India) Limited (CDSL). Please note that the voting

through electronic means is optional for the Members.

7. The members who have cast their vote by remote e-voting

prior to the AGM may also attend the AGM but shall not be

entitled to cast their vote again.

8. The remote e-voting period commences on September 27,

2015 (9.00 a.m. IST) and ends on September 29, 2015 (5.00

p.m. IST). During this period shareholders of the Company,

holding shares either in physical form or in dematerialized

form, as on the cut-off date (record date) of September 23,

2015, may cast their vote by remote e-voting and that a person

who is not a Member as on the cut-off date should treat this

Notice for information purposes only. The remote e-voting

module shall be disabled by CDSL for voting thereafter.

E-Voting facility:

9. The process and manner for remote e-voting are, as under :

(i) Log on to the e-voting website www.evotingindia.com

(ii) Click on “Shareholders” tab.

(iii) Now Enter your User ID

a. For CDSL: 16 digits beneficiary ID,

b. For NSDL: 8 Character DP ID followed by 8 Digits

Client ID,

c. Members holding shares in Physical Form should

enter Folio Number registered with the Company.

(iv) Enter the Image Verification as displayed and Click on

“Login”.

(v) If you are holding shares in demat form and had logged on

to www.evotingindia.com and voted on an earlier voting

of any company, then your existing password is to be

used.

(vi) If you are a first time user follow the steps given below:

For Members holding shares in Demat Form

and Physical Form

Permanent Enter your 10 digit alpha-numeric PAN issued by

Account Income Tax Department (Applicable for both demat

Number shareholders as well as physical shareholders)

(PAN) ! Members who have not updated their PAN with

the Company/Depository Participant are

requested to use the first two letters of their

name and the last 8 digits of the sequence number

(As mentioned in the Attendance Slip of AGM)

in the PAN field.

! In case the folio number is less than 8 digits

enter the applicable number of 0’s before the

number after the first two characters of the name

in CAPITAL letters. Eg. If your name is Ramesh

Kumar with sequence number 1 then enter

RA00000001 in the PAN field.

Date of Enter the Dividend Bank Details or DOB (in dd/

Birth mm/yyyy format) as recorded in your demat account

(DOB) or in the Company records in order to login.

OR ! If both the details are not recorded with the

Dividend depository or Company please enter the member

Bank id/folio number in the Dividend Bank details field

Details as mentioned in instruction (iii).

(vii) After entering these details appropriately, click on

“SUBMIT” tab.

(viii) Members holding shares in physical form will then reach

directly the Company selection screen. However,

members holding shares in demat form will now reach

‘Password Creation’ menu wherein they are required to

mandatorily enter their login password in the new

password field. It is strongly recommended not to share

your password with any other person and take utmost

care to keep your password confidential.


3

(ix) For Members holding shares in physical form, the

details can be used only for e-voting on the resolutions

contained in this Notice.

(x) Click on the Electronic Voting Sequence Number

(‘EVSN’) of Taneja Aerospace and Aviation Limited.

(xi) On the voting page, you will see “RESOLUTION

DESCRIPTION” and against the same the option “YES/

NO” for voting. Select the option YES or NO as desired.

The option YES implies that you assent to the

Resolution and option NO implies that you dissent to

the Resolution.

(xii) Click on “RESOLUTIONS FILE LINK” if you wish to

view entire Resolution details.

(xiii) After selecting the resolution you have decided to vote

on, click on “SUBMIT”. A confirmation box will be

displayed. If you wish to confirm your vote, click on

“OK”, else to change your vote, click on “CANCEL”

and accordingly modify your vote.

(xiv) Once you “CONFIRM” your vote on the resolution,

you will not be allowed to modify your vote.

(xv) You can also take out print of the voting done by you

by clicking on “Click here to print” option on the Voting

page.

(xvi) If Demat account holder has forgotten the changed

password then enter User ID & image verification code

& click on Forgot Password & enter details as prompted

by the system.

(xvii) a. Non-Individual shareholders (i.e. other than

Individuals, HUF, NRI etc.) are required to log on to

www.evotingindia.com and register themselves as

Corporates.

b. A scanned copy of the Registration Form bearing

the stamp and sign of the entity should be emailed

to [email protected].

c. After receiving the login details they should create

compliance user using the admin login and password.

The Compliance user would be able to link the

account(s)/ folio numbers on which they wish to

vote.

d. The list of accounts should be mailed to

[email protected] and on approval

of the accounts they would be able to cast their

vote.

e. A scanned copy of the Board Resolution and Power

of Attorney (POA) which they have issued in favour

of the Custodian, if any, in PDF format in the system

for the scrutinizer to verify the same.

(xviii) In case you have any queries or issues regarding e-

voting, you may refer the Frequently Asked Questions

(“FAQs”) and e-voting manual available at

www.evotingindia.com under help section or write an

email to [email protected] or contact

CDSL at 18002005533 (toll free).

10. The Board of Directors have appointed Mr. T. G. Janakiraman,

Practicing Company Secretary, to act as Scrutinizer to

scrutinize voting at the AGM & remote e-voting process in a

fair & transparent manner.

11. The Chairman shall, at the AGM, at the end of discussions on

the resolutions on which voting is to be held, allow voting

with the assistance of Scrutinizer by use of “Polling Paper”

for all those members who are present at the AGM but have

not cast their votes by availing the remote e-voting facility.

12. The Scrutinizer shall after the conclusion of voting at the

AGM will count the votes cast at the meeting & thereafter

unblock the votes cast through remote e-voting in the presence

of at least two witnesses not in the employment of the

Company & shall make, not later than 48 hours of the

conclusion of the AGM, a consolidated scrutinizer’s report

of the total votes cast in favour or against, if any, to the

Chairman or a person authorized by him in writing, who shall

countersign the same & declare the result of the voting

forthwith.

13. The Results declared along with the report of the Scrutinizer

shall be placed on the website of the Company at

www.taal.co.in and on the website of CDSL

www.evotingindia.com. The results shall also be immediately

forwarded to the BSE Limited.

14. The documents, if any, referred to in the accompanying Notice

and the Explanatory Statement shall be open for inspection at

the Registered Office of the Company during normal business

hours (9.00 am to 5.00 pm) on all working days except

Saturdays, upto the date of the AGM.

15. Members are further requested to :

- Intimate changes, if any, in their registered address/ bank

mandate and email address to the R&T Agent for shares

held in physical form and to their respective Depository

Participants for shares held in Demat form.

- Quote Ledger folio number/ DP ID/ Client ID in all the

correspondence with the Company or its R&T Agent.

- Intimate about consolidation of folios to the R&T Agent,

if your shareholding is under multiple folios.

- Note that as per SEBI/ Stock Exchange guidelines the

shares of the Company are traded compulsorily in Demat

form. As per the guideline issued by SEBI there are no

Demat Account opening charges. In view of this Members

are requested to convert their physical share certificate

into Demat form.

- Bring their copies of the Annual Report and the

Attendance Slip at the AGM.

- Note that the Company has designated an exclusive

e-mail id viz. “[email protected]” to enable investors

to register their complaints, if any.

4

Item No. 4:

The Board of Directors, upon the recommendation of the

Nomination and Remuneration Committee, at its Meeting held on

August 14, 2015 had appointed Mrs. Preeti Taneja as an Additional

Director of the Company in the category of Non-executive (Non-

Independent Director).

Pursuant to the provisions of Section 161 of the Companies Act,

2013(Act), Mrs. Preeti Taneja holds office upto the date of ensuing

Annual General Meeting.

The Company has received from Mrs. Preeti Taneja:

(i) Consent in writing to act as Director in Form DIR-2 pursuant

to Rule 8 of the Companies (Appointment & Qualification of

Directors) Rules, 2014;

(ii) Intimation in Form DIR- 8 in terms of Companies

(Appointment & Qualification of Directors) Rules, 2014 to

the effect that she is not disqualified under Section 164(2) of

the Act.

The Company has received a notice in writing pursuant to provision

of Section 160 of the Act and rules made thereunder, regarding

candidature of Mrs. Preeti Taneja for the office of Director.

Accordingly, the Board recommends the resolution as set out in

Item No. 4 for approval of the Shareholders of the Company.

Brief resume of Mrs. Preeti Taneja as stipulated in Clause 49 of

the Listing Agreement is forming part of this Notice.

Except Mrs. Preeti Taneja, Mr. Salil Taneja and his relatives, none

of the Directors, Key Managerial Personnel and their relatives are,

in any way, concerned or interested financially or otherwise in the

said resolution.

Item No. 5:

Mr. R. Surie is Director of the Company for last 18 years. As

required by the Companies Act, 2013 (Act) the Board has

proposed to appoint Mr. R. Surie as an Independent Director of

the Company.

Mr. R. Surie meets the criteria of independence as provided under

Section 149(6) of the Act and the Rules made thereunder and

Clause 49 of the Listing Agreement executed with the Stock

Exchange. Mr. R. Surie is not disqualified from being appointed as

Director in terms of Section 164 of the Act. Mr. R. Surie has given

EXPLANATORY STATEMENT PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013

consent to act as such Director. In the opinion of the Board, he

fulfills the conditions specified in the Act for appointment as

Independent Director and is independent of the Management.

Accordingly, the Board of Directors at its meeting held on August

14, 2015, appointed him as Independent Director of the Company

pursuant to Section 149 read with Schedule IV of the Act to hold

office until the conclusion of 27th Annual General Meeting of the

Company and that he shall not be liable to retire by rotation

subject to approval of shareholders at the ensuing Annual General

Meeting.

A notice in writing in the prescribed manner as required by Section

160 of the Act and Rules made thereunder has been received by the

Company, regarding candidature of Mr. R Surie for the office of

Director.

The terms and conditions of appointment of Independent Director

will be open for inspection at the Registered Office of the Company

by any member during normal business hours.

Accordingly, the Board recommends the resolution as set out in

Item No. 5 of the Notice for approval of the Shareholders of the

Company.

Brief resume of Mr. R. Surie as stipulated in Clause 49 of the

Listing Agreement is forming part of this Notice.

Mr. R. Surie is interested in the resolution set out at item no. 5 of

the Notice.

Except as mentioned above, none of the Directors, Key Managerial

Personnel and their relatives are, in any way, concerned or interested

financially or otherwise in the said resolution.

By Order of the Board of Directors

Chetan Nathani

Pune, September 1, 2015 Company Secretary

Registered Office:


Krishnagiri District, Belagondapalli – 635 114, Tamil Nadu


5

DETAILED PROFILE OF THE DIRECTORS SEEKING APPOINTMENT / RE-APPOINTMENT

PURSUANT TO CLAUSE 49 OF THE LISTING AGREEMENT IS AS UNDER:

R. Surie C. S. Kameswaran Preeti Taneja

Age 63 years 64 years 61 years

Qualification B. Tech from IIT, Kanpur CA, Post Graduate in BA - Specialization in

& Masters in Business Business Administration Psychology

Administration from

Harvard School of

Management, U.S.A

Date of Appointment/ Re-appointment July 12, 1997 January 28, 2004 August 14, 2015

Category Non-Executive Director Non-Executive Director Non-Executive Director

(Independent) (Non-Independent) (Non-Independent)

Experience & Expertise in specific Consultancy & Aviation Three decades of rich Associated with Group CSR

functional Area related business working experience in leading Activities & other social

large and medium scale activities.

industries in various

capacities covering the areas

of Corporate Planning,

Finance and Management.

Relationship with other Directors, None None Relative of Mr. Salil Taneja

Key Managerial Personnels of

the Company

Shareholding of Directors 1,67,094 Nil Nil

Directorship held in other Companies 1. C.D. Aviation (India) 1. TAAL Tech India Pvt. Ltd. NA

Pvt. Ltd. 2. TAAL Enterprises Ltd.

2. Hitech Graphics Pvt.

Ltd.

Member/ Chairman of Committees of Nil Nil Nil

other Companies

6

ROUTE MAP FOR LOCATION OF VENUE OF THE AGM

Taneja Aerospace and Aviation LimitedRegd Office: Belagondapalli Village, Thally Road, Denkanikottai Taluk, Krishnagiri Dist.

Belagondapalli – 635114, Tamil Nadu.

IMPORTANT COMMUNICATION TO MEMBERS

Pursuant to the provisions of the Companies Act, 2013, the Central Government has taken “Green Initiative” by allowing

companies to serve notice/ documents including Annual Reports by e-mail to its members. This will also ensure prompt

receipt of communication and avoid loss in postal transit. The members can also download these documents from the

Company’s website i.e. www.taal.co.in. To support this “Green Initiative” in full measure, members who have not

registered/ updated their email addresses so far, are requested to register/ update their e-mail addresses by sending e-mail

to [email protected] or [email protected] with subject as ‘E-mail for Green Initiative’ mentioning

their Folio No./ Client ID. Members holding shares in Demat form may register/ update their e-mail addresses with the

Depository through their concerned Depository Participant(s).


7




CIN: L62200TZ1988PLC014460

26th Annual General Meeting

PROXY FORM

[Pursuant to section 105(6) of the Companies Act, 2013 and rule 19(3) of

the Companies (Management and Administration) Rules, 2014]

Name of the Member (s) :

Registered address :

E-mail Id :

Folio No/ Client Id DP ID

I/We, being the Member (s), holding ...... shares of the above named Company, hereby appoint :

(1) Name Address

E-mail ID Signature or failing him

(2) Name Address

E-mail ID Signature or failing him

(3) Name Address

E-mail ID Signature

as my/our proxy to attend and vote (on a poll) for me/us and on my/our behalf at the ANNUAL GENERAL MEETING of the

Company, to be held on Wednesday, September 30, 2015 at 2.00 P.M. at the Registered Office of the Company at Belagondapalli Village,

Thally Road, Denkanikottai Taluk, Krishnagiri District, Belagondapalli - 635114, Tamil Nadu and at any adjournment thereof in respect

of such resolutions as are indicated below :

Resolution Resolutions Vote (Optional – See Note 2)

No.

For Against

Ordinary Business

1. To receive, consider and adopt:

a) the Audited Financial Statements of the Company for the Financial Year ended

March 31, 2015 together with Reports.

b) the Audited Consolidated Financial Statements of the Company for the Financial

Year ended March 31, 2015 together with Report.

2. Re-appointment of Mr. C. S. Kameswaran who retires by rotation and being

eligible, offers himself for re-appointment.

3. Appointment of Statutory Auditors.

Special Business

4. Appointment of Mrs. Preeti Taneja as Director.

5. Appointment of Mr. R. Surie as an Independent Director.

Signed this .................. day of ......................... 2015.

Signature of Shareholder :

Signature of Proxy holder(s) :

Note :

1. This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of the

Company, not less than 48 hours before the commencement of the Meeting.

2. It is optional to put ‘"’ in the appropriate column against the Resolutions indicated in the Box. If you leave the ‘For’ or ‘Against’

column blank against any or all Resolutions, your Proxy will be entitled to vote in the manner as he/she thinks appropriate.

3. For the Resolutions, Explanatory Statements and Notes, please refer to the Notice of the 26th Annual General Meeting.

4. Please complete all details including details of Member(s) in above box before submission.

Affix

Re 1/-

Revenue

Stamp


9




CIN: L62200TZ1988PLC014460

26th Annual General Meeting

ATTENDANCE SLIP

Name and Address of the Shareholder :

Folio No. / DP Id & Client Id :

Number of Shares held :

Name of the attending Shareholder/ Proxy :

(IN BLOCK LETTERS)

I certify that I am a registered shareholder/proxy for the registered shareholder of the Company.

I hereby record my presence at the ANNUAL GENERAL MEETING of the Company being held on Wednesday, September 30,

2015 at the Registered Office of the Company at Belagondapalli Village, Thally Road, Denkanikottai Taluk, Krishnagiri

District, Belagondapalli - 635114, Tamil Nadu at 2.00 p.m.

Member’s/Proxy’s Signature

Note: Please complete this and hand it over at the entrance of the hall.

ELECTRONIC VOTING PARTICULARS

Electronic Voting Sequence Number (EVSN) # DEFAULT PAN

# If you have not registered/ updated your PAN with the Company/ Depository Participant, please use the number mentioned

in above column under PAN field to login for e-Voting.

* If you have already registered/ updated your PAN with the Company/ Depository Participant use the actual PAN issued

by Income Tax department.

Note: For detailed e-voting instructions, please refer “Notice” enclosed herewith under “E-Voting facility”.

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